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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: Is your opinion on VET improving? Seems like they might be at the "right place, right time" since a fair chuck of their cash flow is associated with European natural gas. The supply there is being pinched by Russia and spot prices are rising rapidly. Haven't looked in detail but it seems that VET's cash flow should be very high going forward, especially if they can hedge at high prices. Would guess they can reinstate some dividend. Thoughts?
Read Answer Asked by Kel on September 30, 2021
Q: Eric Nuttall has an interesting column in the Financial Post today saying investing in oil and gas right now is a 'generational opportunity', that Canadian oil and as are hugely undervalued and could double in a year. What do you think of increasing oil and gas holdings? How much do you think would be appropriate right now and do you still think Suncor is the way to go? I notice you have only a very small 1% holding in the balanced portfolio.
Read Answer Asked by John on September 30, 2021
Q: Hi to all at 5i

Not sure if this question is within the scope of what is asked but, as you well know, the price of natural gas has been soaring lately. That said, natural gas pricing is somewhat confusing as the quoted price in the media appears to be based on the Henry Hub spot price. However, Canadian pricing appears to be based on AECO. The confusing piece is why is AECO pricing so low; in particular, the AECO price decreased by more than 50% to $2.00 on September 20 when the HH price increased to approximately $5.25. If AECO is reported in C$, then the difference would be even more significant.

Thank you very much
Read Answer Asked by Brad on September 30, 2021
Q: Hello 5i Team,
I would like to expand my utilities exposure (beyond the positions I already hold in Emera and Fortis). I am considering taking a position in either Canadian Utilities or Capital Power. Both have similar yields and dividend growth over the past 5 years. Which of the two would you favour, and why? This is for a long-term income focused account.
Many thanks,
Brian
Read Answer Asked by Brian on September 30, 2021
Q: There seems to be a consensus that energy companies will enjoy a resurgence for the foreseeable future. Two part question : do you concur? Secondly, if you do, would you recommend an ETF [?] to track the industry or any individual co's. I presently own Suncor and Cenovus.
Thanks
Read Answer Asked by steve on September 30, 2021
Q: In my wife's TFSA we ended up with a bunch of Peyto stock that essentially I did not liquidate in 2020 because by the time I accessed the account it was sort of too late. In a fairly typical example where the best investments are the forgotten ones, it has swollen to a major part of that account. What are your thoughts on its run, its current debt and its potential. I will be reducing the holdings due to the position size but I have been reluctant to sell much while it has been on a (volatile) run up.
Read Answer Asked by Graham on September 29, 2021
Q: Please suggest a few promising names in the battery / energy storage business ... the kind of storage needed for wind, solar, etc. generated electricity, with an eye towards supporting electric vehicles. It would be great if you could identify a company or two that is currently making money in this space. Thanks!
Read Answer Asked by Ed on September 28, 2021
Q: what are your best your best stock ideas in the natural gas sector
Read Answer Asked by Pierre on September 28, 2021
Q: I have a 1.7% weighting in Fortis, which is the only utility I own in my RRSP. I'm hesitant to do so because of their gargantuan debt levels. With total liabilities of around 33.4 Billion, this is higher than their total market cap of around 27 Billion.
Net Debt to EBITA ratio around 6.2x , and low interest coverage of 2.3.
Free cash flow also only covers around 11.5 % which is quite low.
So do you still see Fortis as an attractive investment for a 10 year hold ?
Thanks !
Read Answer Asked by Gordon on September 28, 2021
Q: Hello,
You recently stated that you were averaging down to pick up some more SU. I went in to read your report on it as I currently only have ENG. However, there doesn't appear to be one. Is that correct? There's been a lot of recent chatter about rising natural gas prices and with the recent increases in oil prices, I'm assuming your favourites currently are ENG and SU. Thank you.
Read Answer Asked by jeff on September 27, 2021
Q: Hi, I have read that several U.K. utilities have recently collapsed given soaring wholesale natural gas prices and the inability to pass costs on to customers. Could the same thing happen here and if so which companies might be the most susceptible? Could any of the above companies be impacted? Thanks.
Read Answer Asked by Gary on September 27, 2021
Q: Energy companies seem to be generally riding the wave the continued higher oil and gas prices and their share prices are rising accordingly in many cases. My question is do you feel that we may see some companies in the sector initiating new dividends? if so how much of an effect on stock price can one expect if a dividend is initiated by a company? any thoughts on some companies that may be set to start paying a dividend?
Read Answer Asked by John on September 27, 2021
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