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Tourmaline Oil Corp. (TOU)
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MEG Energy Corp. (MEG)
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Whitecap Resources Inc. (WCP)
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Birchcliff Energy Ltd. (BIR)
Q: I’m interested in investing in 2 of the above O&G producers. I would appreciate 5i’s recommendation and possibly a brief description of reasonings.
Thank you
Thank you
5i Research Answer:
TOU: we consider TOU to be the best-managed and likely safest natural gas stock. It is cheap, dividends are nice and management has grown and sold many companies previously. WCP/MEG are more oil-weighted. We would be largely indifferent. MEG is larger and does not pay a divi dividend (it expects to soon) and its large reserves give it upside if oil moves higher. WCP is cheap and fine and offers a decent yield. If an investor expects oil to rise we would side with MEG for upside potential.