CES Energy Solutions Corp. (CEU.TO)

A name in a portfolio that makes a lot of sense. Make sure it is part of a basket of such stocks.

Probably one of the best managed of the services companies. Tends to be one of the higher ROE companies. He doesn’t own a lot of oil/gas today, but he would guess that by June/15, he will. This would be one of those names that he would be taking a hard look at.

They are all making multi-year lows. He thinks there is value here, but he does not know the company. He likes the group overall. People are being very short sighted in their selling.

He does not want to own any service stocks at all. With the oil price and profitability so low production companies will have very little capital to spend on drilling. Oil services companies get hit first with low oil prices. The CEO has been selling the last couple of weeks. The guest owns less of this than he did a week and half ago.

Energy services company that helps with fluid handling. Looking at a long-term chart the company has done very well, but has come off quite a bit in the last 6 months. Have come out with very good earnings every quarter, but thinks it is getting caught up with oil prices coming down. If you are a long-term believer in management, which he is, you should continue to hold. It is also a pretty good buying opportunity.

This is quite a remarkable company. They make the custom fluids for fracing, so they will be affected somewhat by the price of oil. The reality is that if you are going to do wells and you are going to frac them, you want to put the right stuff down that well. This is exactly the company that will benefit from people trying to save some money in terms of drilling by having better outcomes.

He noticed that after the energy stocks started tanking when they shouldn't have been, they should have been strong through the end of July into October, and we have done nothing, but break down since July. It is not just a supply issue in oil and gas, but it is actually a demand issue. Support seems to be at around $7. This is across the area.

This is more of a technology company than an energy company. They spend a great deal of time and effort on trying to enhance the drilling techniques and the completion techniques for drilling companies. Because they are light on their assets, they get some amazing returns on capital. Stock does trade sometimes at a pretty high valuation, but the earnings acceleration is quite robust, especially now they are starting to win some significant market share in the US.

They are in the drilling fluid service sector and have done phenomenally well. Has looked at this several times, but what has made him think twice is that it tends to trade at a fairly rich valuation. If it sold off, this might be one he would look at.

Has a good dividend policy with a decent yield of about 3%. Thinks they have increased their dividend by about 40% per annum in the last 5 years. Likes the energy services sector, but is not a holder.

Is it normal for insiders to be selling when you have a stock split? It is usually not normal. Those who follow insider buying and selling would certainly be alarmed. This is currently at $9.94 and its FMV is $9.82, a negative 4%. Very, very expensive here. These energy services companies have had huge runs over the 6-7 months. They are fully valued. This is too highly valued for him.

Great management team. Very entrepreneurial. Great expansion story into the US businesses. Levered to the evolution of fracing into the shale plays. Has never really been that cheap, but at these levels it is an interesting name and one that people can own.

This has had a more shallow correction so he rather likes that corrected period. Chart indicates an A, B and C. Sometimes the B will be a little bit higher, but he thinks you are fine. There is support at around the $9.50 area.

One of the main holdings in his energy infrastructure fund. This company makes the chemicals that make fracing work. Getting good margins and they are growing. Now into the oil sands where they are probably going to be a big player. Had run up to $30, so they split it 3 for 1 and it traded off from $11.50 to around $9. This is a very good entry point.

There is a boom in the production of drilling. Earnings growth is strong. Good support at $30. A lot of energy companies pulled back over the last few weeks and he is not that bothered by it. You can buy it here as it has pulled back to natural support.