Energy Prospectus

- HFI research makes Baytex it's 2024 pick of year

https://open.substack.com/pub/hfir/p/important-our-top-e-and-p-stock-picks?r=nh748&utm_campaign=post&utm_medium=web

Baytex Energy (BTE) stock that checks all the boxes for the most upside in 2024. BTE’s cash flow has jaw-dropping torque to oil prices. An investor who is highly confident that the U.S. and China will avoid a recession—or who simply wants to bet on higher oil prices in 2024 for whatever reason—should go with BTE

You should all read the article at the link above. HFI is a highly respected outfit.

The discussion of the Macro outlook for oil prices is very good and supports my view that WTI will average $80US/bbl in 2024.
All of my stock valuations are now based on WTI averaging $75/bbl in Q1, $80/bbl in Q2 and $82.50/bbl in 2H 2024.

From the article: "Assuming our three scenarios, in which we see a 20% probability of $60 per barrel WTI, a 60% probability of $82 per barrel WTI, and a 20% probability of $92 per barrel WTI, our 2024 price target for the BTE shares is $8.71." < My current valuation of BTE (based on WTI averaging $80US/bbl in 2024) is $9.05Cdn, which equates to about $6.70US per share.

At the time of this post BTE was trading at $3.33US.

All of our Sweet 16 companies will survive an extended period of $60US/bbl of WTI, because their balance sheets are in much better shape today than they were in 2020, when WTI averaged ~$50US/bbl.

If the Fed actually does lower interest rates, I see zero chance of WTI going to $60. IMO it will take a MAJOR global recession to cause that large of a drop in oil prices.