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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: Hi Peter and team,
I hold SGY and HWO as part of my O&G portfolio, you used to recommend these two for income. I am surprised with the lack of correlation with oil prices for HWO stock (is it due to small size?) and with unexpected behaviour for SGY stock today: the oil is up, Canaccord Genuity raised stock price target to C$4, yet the stock is down? Any explanations? Any thoughts on HWO and SGY perspectives and risk level? I have losses on both stocks but don't mind holding them if there is a light at the end of the tunnel :-)
Also, what do you think of CVE situation, is it a buy opportunity?
Read Answer Asked by Michael on February 17, 2015
Q: Hi
Looking for an update on a few of your recommendations I currently own:
Surge- Seems like oil has found some footing for now. Would seem like some kind of move to the middle would be in order after such a panic adjustment. Looks like you are suggesting a hold here. Do you have a sense for the underlying commodity price going forward.
Avigilon- seems to have recouvered from weakness. is there upside here or a good time to sell.
Descartes- same
Fiera Cap - same
Questor-same
Read Answer Asked by LJ on February 09, 2015
Q: Sensing 5i's eroding confidence in Surge, I have sold my shares (even though you have recently suggested holding). Now I have zero allocation to the energy sector. I want to get back in on more solid ground. Can you suggest two stocks and a methodology for easing back in? Your persistence in recommending a full and proper sector allocation has been so valuable that the strategy has more than balanced out the loss in Surge. Yet I know I need to get back into energy. Thank you, don't know what I'd do without you guys.
Read Answer Asked by Jerry on January 23, 2015
Q: Hi 5i team!

With $47 oil would you know what SGY's approx. net back is? I know it was disclosed in the recent quarterly release at much higher oil prices, but the royalty rate also fluctuates. I am looking to go overweight in my portfolio with SGY and am willing to be patient with low oil prices for 2 to 3 years, but I am wondering SGY's "going concern" (risk of bankruptcy) with prolonged low oil prices. From my perspective if SGY is still making money at $30 oil when their hedges roll off then the long term investment should pay off?

Thanks for the advice and looking forward to the 5i Conference!
Angelo
Read Answer Asked by Angelo on January 22, 2015
Q: STB - I know it's not a strong Balance Sheet - too much debt, etc. etc. but it has given my wife nearly 8% for over 3 yrs.& that huge French transportation co. has kept buying 95,000 shares per month for over 18 months. I can't find out anything else - can you?!

SGY - Insiders keep buying large - even last week. Any news??
Thank you.
Read Answer Asked by Robert on January 22, 2015
Q: Royal Bank released an update with a new target of $4.00, sector perform. Their release also indicated an "exit net-debt-to-trailing-cash-flow ratio of 3.3x, higher than its direct peers at 1.9x". The SGY website indicated their "current" D/CF was 1.4x. BNN analysts have said that a D/CF ratio > 2.0 is a warning sign. Your thoughts please?

Also, I have been using P/CF, D/CF and hedging % (H1 = 34% @ $101, H2 = 14%) as a few of the metrics to guide me. Your thoughts please?

Thanks for your help,
Steve
Read Answer Asked by Stephen on January 12, 2015
Q: SGY Paul Colborne has stepped down as Chairman, however remains as CEO. Dividend cut by 50%. How secure is their reserve credit line?
PETER, You know the management of this Co personally. What is your current judgement?

ARX New issue as a Bought Deal. Current price is now down approx. 33% to 22.5 from 33.68. Does this represent a buy or a sell after the rebound in O. Thank you - Bob.
Read Answer Asked by Robert on January 08, 2015
Q: One more question about Surge. I note that the insider buying has remained quite constant during the recent downturn and in large amounts. In addition there has been no sales to speak of. I know that insiders are not infallible but does this not speak to their confidence in the boards ability to maintain the dividend and the recovery in the share price?
Read Answer Asked by Robert on December 17, 2014
Q: Hi Peter and Team:
In my Tax saving account, I bught SGY at 7.99 in August 2014 & QST at 3.65. Now SGY is down to 3.65 & QST is down to 2.80. what's your suggestion? do I sell or hold? what do you think those 2 companies fundamentally? I am long term investor.
thank you so much for your excellent service.
Read Answer Asked by hong on December 11, 2014
Q: Morning ...first of all I want to thank you and Ryan for answering all our concerns regarding the oil sector. These are trying times for us amateur investors (especially me) ...we are living the results of proper diversification and weightings, I think these are valuable lessons for all of us. My question is this ...you mention the hedging aspect of companies selling oil at a certain price ,can you tell me how far into 2015 does Surges hedging go? Would I be correct in presuming the dividend is safe till new prices (lower) then hedged in? Thanks as always.
Read Answer Asked by Alan on December 02, 2014
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