Investment Q&A

Q: At $50ish WTI, if all I cared about was the DIV. sustainability and no bankruptcy, which of the above would you list as best.
thanks
Yossi

Q: I currently have a position in cnq and wondering if this company is the best way to get exposure to oil. I am targeting a 5% position in my portfolio for oil stocks. I am considering selling this position in favour of Royal Dutch Shell. I am not concerned with the Canadian/us exchange since I hold both currencies. My targeted rate of return is 10% per year over the long run (dividend plus capital appreciation)and a 6% current yield in RDS goes a long way in achieving this return. I am also not concerned with the tax impact so the dividend tax credit is not an issue.
What is your preferred way to hold you exposure to oil? Is there a stock that you prefer to cnq or RDS?

Thanks for your comments.

Q: For a sideways tax loss position move for 30 days what would you recommend, or is there one?

Q: There has been some privatization chatter from Nuttal around o&g companies that have the cash and the value of the company is depressed enough to be able make this happen. I would think it many cases this wouldn't be that great of an event for many shareholders. For example, you own say Crescent Point and are down like 40% and they take it private at a 20% premium. You are now forced to sell and accept your 20% loss where in some cases you may have had confidence in the long term future of the company. Is it ever possible to keep your shares and be a private equity owner of the company?

Q: Your thoughts on buying this stock for eventual rebound in the oil industry. Good div. that looks sustainable. Can you list the companies fru holds in their royalty play.

Q: Crescent Point Energy just announced the sale of their Utah assets plus some Saskatchewan property, reducing their debt by almost a billion. With their reduced Cap/Ex, share buy backs, and paying down their debt is this the time to jump in? They appear to still have many years of proven reserves and a large 160000+BPD production and great potential for share appreciation.
Appreciate your opinion.
Thanks Gord

Q: Can you give me your general thoughts on Crew? Very cheap; not sure if there is something company-specific. As well, I guess my biggest concern is whether debt they have can be serviced by their cash flow. Debt does not seem that bad, $330M. Is this something I should worry about, because I am happy to wait for better times if debt concerns are relatively low risk. Thanks!

Q: Your comments on the current price of this stock. Seems oversold but may need some contracts to boost price. Cheers

Q: Peter; Eric is on the BNN soap box and he is always talking about stocks trading at “ 10-15% free cash flow”. How does this relate to the actual dividend yield and why is it so an important benchmark ? With tax loss selling looming wouldn’t any oil rally be drowned out by sellers? Thanks . Rod

Q: Good Morning 5i,

So on this fine Friday long weekend morning, I'd like to pick the brains of people who've "been there and done that" much longer and more successfully than I, and have seen some things in the financial world first hand that I have not.

I want your opinion on oil and gas. Are we not watching one of these classic "blood in the streets" scenarios you always read about as investors and wish you'd had the fortitude to plug your nose and dive in? The shares of almost every publicly traded company in the space are being thrown away for nothing. The good ones, the bad ones, the ones making money, the ones losing money, good balance sheets, bad balance sheets - it's almost irrelevant. If they're in the space they're being slaughtered.

So if the thesis is:

a) it will take a lot longer to power the world with worm casings, pixie dust, and unicorn farts than some would have us believe (i.e. hydrocarbons are not going anywhere in the foreseeable future)

b) a surprising number of these companies have solid balance sheets

c) a surprising number of these companies are earning profits hand over fist, doom and gloom aside

If a, b, and c are indeed true, you'd have to believe a lot of these companies trading at historic lows will eventually make investors a lot of money. Like buying Florida real estate in 2009.

What am I missing? What holes can be shot in this thesis, looking at it objectively?

I take the point that there is no catalyst to change things or excite investors in this space (although I do get surprised from time to time that the fact that a company can throw off ridiculous amounts of profit and return it to shareholders via dividends and buybacks doesn't itself become a catalyst, but I digress...)

I also take the point that these scenarios can persist for a lot longer than people think they can before things change.

Single-company risk is always there, I understand that, but I reject the idea that all of these companies are headed for bankruptcy.

Aside from patience and the stomach to watch your investment get hammered in the short term - where exactly are the risks?? This seems like such a great buying opportunity that I feel I have to be missing something.

Thank you for whatever insight you can share, and happy long weekend to you and your families!

Ryan

Q: Hi Team, TWM is down to $1.00 level, Is it worth to gamble on ? Thanks as always.
Tak

Q: Hi,

I am thinking of swapping my VET position for a position in WCP, mainly from a dividend sustainability perspective and also a future growth potential perspective.

Does this sound like a constructive move or am I misguided or missing something? Are there any other energy opportunities that you would point out instead of WCP for income and growth potential?

Thanks,
Derek

Q: Eric Nutall at Ninepoint keeps on saying he is buying heavy into energy space companies that are trading around 2.5 EV to Cashflow. Just wondering what some of the better names he’d be buying into may be. Any idea or suggestions?

Q: For a bond etf this thing has gone up absurdly high this year to date. Do you expect this to continue? Would you recommend it?

Q: I heard gas prices were incredibly cheap in 2010, when ARC resources was worth $20 a share. I think the Balance Sheet still looks okay with a 10% dividend. What are reasons not to buy this? I own shares at a cost of $25 - If I was willing to buy it before what has changed? Thank you.

Q: Wondering if you could comment on the results out today; you seemed positive on the firm in your response to an earlier question, and I am wondering if these results reinforce your position.

Thanks

Q: everyone seems to agree that the energy stocks have never been so cheap, ignored by investors etc.
can you see a way for those stocks to start getting recognized, should i start picking away.
i do not own any energy, but these is getting ridiculous.
i think jim cramer or one of those pundits said its because of millenials who hate oil, they are into electric. dave

Q: If you were to be buying one of these today, which one and why?
Thx

Q: Would you comment on news today. Does preserving capital mean concern over dividend payout?

Q: Looking to add TRP ( already have ENB ) to my RRSP for some income but am somewhat concerned if there were to be a recession - would this be considered a "Utility " thus less likely to take a hard hit or would I be better looking at BEP.UN, FTS, AQN or EMA and if so, which would you recommend at this time ? Your opinion is greatly appreciated.
thanks