10 Best Canadian Penny Stocks to Buy Now

05. Baytex Energy Corp. (NYSE:BTE)

Number of Hedge Fund Holders: 17

Baytex Energy Corp. (NYSE:BTE) takes the fifth spot on our list of the ten best Canadian penny stocks to buy now. Baytex Energy Corp. (NYSE:BTE) has demonstrated strong financial and operational performance in Q2 2024, making it an attractive investment. The company reported an impressive 23% increase in production per share compared to Q2 2023, with an average production of over 154,000 BOE per day, predominantly consisting of oil and NGLs. This growth in production, combined with disciplined capital spending, has resulted in significant free cash flow, which is expected to strengthen in the second half of 2024. The company’s commitment to shareholder returns is evident, with CAD97 million returned through share buybacks and dividends in Q2 alone.

Baytex Energy Corp. (NYSE:BTE) financial metrics further underscore its strong position. The company generated CAD533 million in adjusted funds flow during Q2 2024, translating to CAD0.65 per share, a 38% increase from the previous year. Net income for the quarter stood at CAD104 million, or CAD0.13 per share, with free cash flow amounting to CAD181 million. This robust financial performance is supported by a strategic capital allocation plan, which includes reinvesting in the business, reducing debt, and returning capital to shareholders. The company’s balance sheet remains strong, with a total debt-to-EBITDA ratio of 1.1 times, and efforts to further reduce debt in the coming quarters are underway.

Operationally, Baytex Energy Corp. (NYSE:BTE) has successfully executed its development plans across key assets, including the Eagle Ford and Canadian light oil business units. The company has achieved cost efficiencies, realizing an 8% improvement in operated drilling and completion costs per completed lateral foot over 2023. With continued strong performance from key assets, such as the Eagle Ford and Peavine, Baytex Energy Corp. (NYSE:BTE) is well-positioned to sustain its growth trajectory. The combination of strong production, disciplined financial management, and a shareholder-friendly capital return strategy makes Baytex Energy Corp. (NYSE:BTE) a compelling investment opportunity for those looking to capitalize on the energy sector’s potential.

According to Insider Monkey’s database, 17 hedge funds held stakes in Baytex Energy Corp. (NYSE:BTE) during the second quarter of 2024, an increase from 14 in the previous quarter. These holdings were valued at roughly $77.31 million, with the largest stake held by Israel Englander’s Millennium Management.