RE:Chart for the weekend crowd BayStreetWolfTO wrote: 2022 action plan
1. Debt first to $1.2b (April rough calc)
2. Commence buybacks 25% FCF
3. Debt to $800m
4. Dividends 2023 perfect timing.
This is a great chart. While many below 1.9 are perplexing....Baytex certainly looks to be in a sweet spot.
Can't wait for updated financials so the market can assess the new data and progress.
Exciting times ahead for many of these names
Just a question of how much more I can grab with dividends at these discounted prices.
great chart Wolf. I actually signed in this morning intending to post it myself having seen Nuttal's tweet. So the chart raises a number of questions and observations.
1. Why are the stocks collectively underperforming and will they collectively turn it around? Largely I think this is a sector sentiment thing. I don't think that the sector will ever return to its former glory but I do think money will increasingly flow in to chase dividends (income)
2. What is causing the winners and losers on this graph? I hold several of the poorer performers. Is that good? On the one hand you can get excited about the potential to sling shot forward to catch up if you will, on the other hand you wonder if they will continue to lag. Debt certainly is dragging some down and balance sheet repair is well underway. Hedging also creates a negative sentiment.
3. To get to sector average, bte needs to rise roughly 50%. From yesterday's close of 5.67, we're looking at 8.50 to get to sector average. Massively improving balance sheet should help move us towards sector average. If we're talking moving to the average of the target multiple, we're looking at roughly 3x on the shareprice which is 17 bucks.
4. Between those two numbers is the 2023 target for share price for me. However where it gets interesting is the higher for longer scenario on oil. It's not outlandish to think that bte could exit 2023 with virtually zero debt, a 500m sharefloat and be running close to 1b in fcf. Then what? 2 bucks a share in fcf. That's where it's going to get interesting across the sector because most of these mid caps have the same "dilemma"