Investment Q&A

Q: hi guys i hold all 3 of these stocks , which one has the best up side and would you keep all 3 thanks

Q: What is the free cash flow yield? And doesn't this signal that this is very cheap at the moment?

Q: I want to re-visit a question I asked previously (based on Eric Nuttall's appearance on BNN Bloomberg) and Lionel's input on it. I've reproduced those questions and answers below for reference.

To clarify, Eric was not bullish on natural gas, at least over the next year. What he was feverish on was heavy oil, and his top picks were the three companies above.

I had mentioned Tourmaline Oil which perhaps shifted the conversation toward natural gas, but I was really interested in your take on the heavy oil companies.

Do you share his enthusiasm about heavy oil? I'd appreciate if you could rank these companies. CVE seems the biggest but I sense he sees more potential in the other two which are smaller.



Q: Eric Nuttall was very bullish, almost feverish, on oil (represented by the companies above) while being down on natural gas. To what extent do you agree?

Asked by Kevin on February 27, 2023
5I RESEARCH ANSWER:
We like Eric and used to work right beside him (Peter answering). He is bright and gained lots of experience over the past 20 years. He showed a lot of guts in the oil crash when his fund dropped 70% in three months and fell to $20M in assets (he now manages more than $2B). The sector is very cheap, and vs past cycles corporate balance sheets are very strong. Certainly the lack of spending may results in higher prices over the next three years (depending on the economy). But...it will always be cyclical. The price of oil in fact is even down 14% from before the Ukraine war started. But we think some sector representation certainly makes sense. The TSX is currently at 17.4% energy. We might consider that a bit on the high side. In terms of natural gas, it can be very weather dependent, but we would be more bullish than Eric; the price has dropped so much this year, but it is also dependent on drilling, and the price drop is going to cause even less spending to be done on new gas wells.

Q: I am optomistic that Peter and Eric Nuttall are bullish on the gas sector, as in the 5i reply to Kevin's query (Feb 27). What are your views on XES? Technically, it looks like it has a huge runway to the upside ...Thanks....Lionel

5I RESEARCH ANSWER:
XES is the SPDR Oil and Gas Equipment & Services ETF. Certainly there is upside potential as oil and gas companies spend. However, there has been a trend in the industry towards dividends and buybacks, so spending this cycle may be less than in other periods. Still, the fund is up 38% in the past year, and its 35 holdings look solid. We would be OK owning this for sector exposure, with the understanding that it is always going to be cyclical.

Q: Peter; If I read their numbers correctly they’re only expecting $270M FCF in 2023- is this a miss ? Thanks
Rod

Q: Eric Nuttall was very bullish, almost feverish, on oil (represented by the companies above) while being down on natural gas. To what extent do you agree?

Q: ATH is to report earnings March 1st.
1/4 ly earnings estimates don't look promising.
I notice they have a short position of over 7% about 45mm shares.
I like that insider holdings shows skin in the game,
They have now been on the TSX for a year and price is improving. Any chance ATH will finally start a dividend.
Your comments please.

Q: Hi there,

Looking insight on the two oil companies Athabasca and Surge. What is forecast on 2023 on the cash flow. Will 2023 be a positive on both companies with record cash flow, potential buy share pay backs and dividends. What is your rating on the two companies. Thank you.

Q: what is your opinion on the 2023 budget and capital allocation , market does not seem to like it.
dave

Q: Hello 5i would there be interest in ATH and CR as takeover candidates and if so who would be the most likely companies that would be interested in them and why.

Q: JOY
FRU
ATH
BIR
PXT
TCW
WCP
TVE
ARX
CPG
VET
ERF
MEG
BTE

Which three of the above fourteen oil & gas stocks would you sell first to bring my sector allocation back to my normal weight? This is assuming 100 WTI oil in 2023. Could you also provide a brief reason for each of the three stocks that you would get rid of first. Thanks.

Q: your opinion on earnings of gear and athabaska. dave

Q: I believe athabasca has around 200 milion in cash and around 175 milion in debt. Is there a reason why the company would not use some or all the cash to retire the debt?

Q: Could you please give your thoughts on the Q3 report released today.
Thanks

Q: Follow up to your answer to Charles , what companies have the best long life assets?

Q: These are my tax loss candidates. Please list the best ones to sell first and which ones would be the best buy back stocks.
Thanks as always
Albert

Q: what are the current annual percentages of dividend, debt and free cash flow yield for each of these companies. use as many question credits as needed

Q: Thanks to your wonderful Portfolio Tracking and Analysis, I know that Energy makes up 11.07 % of my portfolio. Your statistical recommendation is that energy should be 5 % of my personalized portfolio. In order of rate of return, I have Tourmaline Oil, Enbridge, Whitecap, Suncor, Athabasca and Tamarack Valley. I am more heavily weighted in Tourmaline and Enbridge but my question is twofold. Am I really overweight in energy at this time and if so other than trimming from my two big winners, which two or three companies would you eliminate to pare back closer to 5%? The proceeds would go to buying ATD.b and Loblaws. Thanks for this wonderful service.

Q: If you had the opportunity to invest in a couple of energy plays like ATH or TVE versus the Consumer Defensive/Cyclical like L or ATD at this recessionary like time, where would you put your money?? Dennis

Q: i am negative on above 5 companies. Do you recommend I keep all 5 or should I sell all or some, resp. sell and replace with other companies in the sector, such as Whitecap, Parex, SU and others?

I am primarily looking for growth.

Alternatively to energy companies what are the best Canadian growth companies you recommend. Thanks. Klaus

Q: Hi guys I am holding 10.000 shares of this stock and I am down 50% do you think that it has a chance of turning around or would you dump it I don,t need the money , however maybe I should move on to something else thanks Larry