riski wrote: It's impossible to know what the share prices will do in the short term, but I think your post illustrates one of the common mistakes investors make when trying to jump from name to name.
What you have neglected is that investors invest their money in a company based on far future prospects. You are making decisions based on what is likely going to happen in the next few weeks while the big money is making decisions based on estimated company events and cash flow 6-9 months down the line.
This leaves you vulnerable to a change in that future sentiment while you are trying to game some probable near term event that was priced into the stock a long time ago.
Yes, CJ is likely to initiate a dividend. Priced in.
Yes quarterly earnings are going to be good for both companies. Priced in.
I am not expecting surprises from either company and I don't expect the quarterly earnings to do much to the SP unless one of them has a surprise. For example if CJ doesn't announce a dividend, it will go down. If Baytex has much greater success at clearwater than already stated, it will go up.
The only present moment dynamic at play is the price of WTI. Because BTE has much better growth assets, more production, and debt to pay down, it is better leveraged to sustained or increasing WTI compared to CJ. CJ assets are old, low decline, without much in the way of growth prospects. They are ideal dividend paying assets while the share price will level off and hover in the same $2 range for years. Not a growth company.
If WTI prices continue at this level for the coming months, the future estimates of cash flow will increase at a greater rate for BTE than CJ for those reasons and the BTE share price will go up more quickly. The ceiling for BTE share price is very high. CJ share price ceiling is limited, especially once they start paying out significant cash flow instead of reinvesting.
This is colloquially referred to as "torque" among seasoned investors.
Best of luck with your decisions.
forecast123 wrote: Both BTE and CJ will release Q3 report on Nov 4... CJ SP rose significantly today and yesterday while BTE SP rose was less spectacular... Both have invested in Clearwater wells.... I suspect CJ may announce a dividend reinstatement on Nov 4 (while BTE's dividend reinstatement will be several months later) and such rumor mill led to CJ better SP in the last awhile.