Q: Down 12% .is it time to panic or worth keeping for a comeback with a decent dividend? Your view on oil now? Thanks Larry
5i Research Answer:
Oil is weak on a US inventory build and concern on China's economy. But it has always been cyclical. The key now is that the energy sector is in significantly better financial shape than in prior cycles. It can withstand a downturn quite easily (on average). With lower rates ahead in 2024, we would not have a lot of concerns on the sector, considering balance sheets and low valuations. We would be comfortable with WCP, collecting a nice dividend while awaiting a better sector sentiment.