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Peyto Exploration & Development Corp. (PEY)
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Birchcliff Energy Ltd. (BIR)
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Kelt Exploration Ltd. (KEL)
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Tamarack Valley Energy Ltd. (TVE)
the past month. The dividend is in question, I recall $70 oil and $3 gas covers it. Is there any rationale to it being in question?
The other news I see is a new CEO coming in Jan, any thoughts on this?
Would you buy in here or would it be safe to wait for tax loss selling later in the year?
Over the past five years, BIR has performed the best against some of its peers, including TVE, KEL, and PEY. It also has one of the highest yields (~10%) and a relatively high valuation (13.7X forward P/E). For these reasons, we feel its recent performance has lagged against some of its peers.
Currently, its free cash flow is sufficient to service its dividend payments, and its high yield may cause some investors to fear its viability, but the company has a reasonable debt balance and great free cash flows at current oil prices.
There has been a large executive shift, with the CEO retiring, the COO being appointed to CEO, and the Executive VP of Exploration and Executive VP of Operations also retiring. The current VP of Engineering and the current Production Manager will be moved up into the COO and VP of Operations roles. We are not too concerned with this change in management as the company has a long history of profitability and existing employees who are familiar with the operations are now taking over operations.
We would be comfortable buying in here, although, any shocks or changes to the price of oil can impact the share price between now and tax loss selling season.