Trade for Breakout: Bellatrix Exploration Ltd. (BXE)

Company Profile:

Bellatrix Exploration Ltd is a Calgary, Alberta-based intermediate energy producer focused on exploration and development of light oil and liquids-rich natural gas opportunities in some of the most exciting plays in the Western Canada Sedimentary Basin. Currently the Company is focusing on developing its two core resource plays, the Cardium and the Notikewin/Falher intervals in Western Canada. As of December 31, 2014, the companys proved undeveloped reserves included a total of approximately 356,650 million cubic feet of natural gas; 7,975.8 thousand barrels of oil; and 17,508.0 thousand barrels of natural gas liquids. Bellatrix Exploration Ltd. was founded in 2000 and is headquartered in Calgary, Canada.

Recent News:

On May 21, 2015, BXE has closed its private offering of US$250 million of 8.500% senior unsecured notes due 2020 (the “notes”). Bellatrix intends to use the net proceeds from the note offering to partially repay borrowings outstanding under its bank credit facility, thereby strengthening the Company’s capital structure and increasing the Company’s liquidity.

BXE announced the voting results from its annual and special meeting of shareholders held May 20, 2015 in Calgary, Alberta (the “Meeting”). A total of 101,342,250 common shares representing approximately 53 percent of the Company’s issued and outstanding shares were voted in person and by proxy in connection with the Meeting.

It reported a first-quarter loss of $10.5 million, after reporting a profit in the same period a year earlier. It had revenue of $72.9 million in the period and had a loss of 5 cents per share.

Fundamental Analysis:

Ninestocks analyzes several different financial aspects: Growth, Profitability, solvency and efficiency.

Growth – Measures the growth of both the company’s income statement and cash flow.

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Profitability – Measures the historical price movement of the stock.

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Solvency – Measures the solvency of the company based on several ratios.

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Efficiency – Measures the strength and historic growth of a company’s return on invested capital.

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Conclusion:

BXE’s strengths can be seen in its strong growth, strong profitability and strong solvency. Its revenue and net income have increased over several years. Technical indicators signal the bullish signs, as there is a bullish cross in MACD and Stochastic Oscillator. RSI is increasing to 53.92. The current P/E ratio indicates it is undervalued compared to the average P/E ratio of the industry and the sector. We rate Bellatrix Exploration Ltd. (BXE) a BUY.