Baytex Energy Corp (BTE.TO)

(A Top Pick April 27/12. Down 12.83%.) He is in the process of reviewing all Canadian oil because of concerns if there are oil reserves rising in the US, it might affect Canadian oil. But he still likes oil as a fundamental story. This one is a great up-and-coming story.

Very good company and has everything you want to see. Heavy oil producer with a low decline rates. Sold half his position a little while ago when he got worried about differentials blowing out but he’ll buy that back at some point. A half position would be good at this time.

Reported a good quarter. A healthy hold. A lot of heavy oil and a little expensive because of the dividend. It is not a good entry point.

Heavy oil discount in Canada has been widening, mostly because of seasonal reasons and refineries doing maintenance. Those are temporary issues. When you look at this company, they have very good land positions and very good heavy oil assets, which they continue to grow. Pays a good dividend of 5.8%, which he feels is sustainable.

Heavy oil producer. Heavy oil is priced differently from WTI. WTI is at $85 and heavy oil is priced on a differential basis from that. Thinks these differentials will probably stay wide over the next month or so, which should present a buying opportunity. 5.8% yield.

Excellent company. Good management. Very predictable results. They are into heavy pumpable oil. It doesn’t get valued properly in terms of its actual reserves. Have been very smart in shipping oil by tanker to get better prices. New technology is helping them in their extraction levels. Good solid dividend of 5.5%, which can be increased in the future.

Fairly low payout ratio compared to some of their peers. Likes some of their recent acquisitions. Thinks the heavy oil differentials will narrow. Good yield.

Great company. Heavy oil producer in Western Canada. New CEO. Good solid producer.

(Market Call Minute.) Valuation is a little high to him and thinks there are ongoing capital requirements for some future expansion phases which are going to chew into their payout ratios. Very well run company.

Operate in the Seal geological area. Heavy oil but it can be pumped. Have a lot of sections. Good at extracting. Aiming for 40% shipment by tank car. Expecting improved recovery rates. 5.6% yield.

(Market Call Minute.) Likes the yield generating companies but this one is probably a little bit too early. He would like it in the high $40’s before he would buy it.

Nice dividend payer. Price has come down a fair bit recently with the pull back in oil and gas stocks. Great track record of growing and continuing to pay out a steady distribution.

6.6% bond maturing 2021? This is unrated and is low-quality. Long-term for a convertible. When small companies have bonds coming due, they call them and then reissue longer-term ones to put off the need to put a lot of capital in to pay off debt. If you own, check out the conversion premium and the yield advantage over the common underlying. High risk. Better places to be.