A Look At Bonterra Energy Corp.’s (TSE:BNE) Exceptional Fundamentals

Building up an investment case requires looking at a stock holistically. Today I’ve chosen to put the spotlight on Bonterra Energy Corp. (TSE:BNE) due to its excellent fundamentals in more than one area. BNE is a well-regarded dividend payer with a buoyant growth outlook, not yet factored into the price. Below, I’ve touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, read the full report on Bonterra Energy here.

Undervalued with reasonable growth potential and pays a dividend

BNE’s share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts’ consensus forecast growth be correct. Compared to the rest of the oil and gas industry, BNE is also trading below its peers, relative to earnings generated. This bolsters the proposition that BNE’s price is currently discounted.

TSX:BNE Past and Future Earnings, August 22nd 2019
TSX:BNE Past and Future Earnings, August 22nd 2019

BNE has been able to reinvest its profits, as well as pay some out as dividends, which has exceeded the low-risk savings rate, sufficiently rewarding shareholders for taking on the risk of investing in the stock market. However, it is important to remember that dividend yields are a function of stock prices and corporate profits, which can be volatile.

TSX:BNE Historical Dividend Yield, August 22nd 2019
TSX:BNE Historical Dividend Yield, August 22nd 2019

Next Steps:

For Bonterra Energy, there are three key factors you should further research:

  1. Historical Performance: What has BNE’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
  2. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of BNE? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.