Q: Hi Guys
Quite surprised Baytex has dropped $1 off share price in the last month off what seemed to be an already discounted share price.. Any insights into why it is off so much versus other Oil and Gas companies? Also Baytex always is in the top ten traded stocks on the TSX each day. Any idea what that is? does it attract more speculators?
Thanks
Stuart
Quite surprised Baytex has dropped $1 off share price in the last month off what seemed to be an already discounted share price.. Any insights into why it is off so much versus other Oil and Gas companies? Also Baytex always is in the top ten traded stocks on the TSX each day. Any idea what that is? does it attract more speculators?
Thanks
Stuart
5i Research Answer:
BTE is a big momentum stock for US traders, as it also trades in the US. This also sets up arbitrage trades in Canada. But it also has 800 million shares outstanding, with only one shareholder holding above 10%, so there is lots of stock washing around. It is also a stock with a swing from 30c to $59 in the past 12 years, so it can move dramatically both ways (traders love this, of course). BTE still has some debt, and has gotten itself into trouble with debt before. Its financial picture is much cleaner now, but past indisretions likely make investors more worried when the entire sector rolls over as it has done in the past month.