Calfrac Well Services Ltd (CFW.TO)

Seasonality in Canada because of harsh winters and wet springs is Now until after Christmas. The demand has been less than expected and demand for their equipment dropped. Some US guys are competing with them.

Thinks you could see oil prices trade between $80 and $100. The services industry is likely going to be softer in the forth quarter than people may be anticipating. A lot of oil companies have drilled themselves through their budgets for the year. Also, there is a sort of moratorium on takeovers now. Good dividend yield, well run and a little more exposure to the US than, say, Canyon. But he would prefer Canyon.

What is happening in the whole service area in Western Canada is that drilling is down, Québec has been saying no fracing and there are also problems in the US so the stock has been under some pressure. Thinks that environment is going to probably continue. Not a big yield so not a lot of support from a dividend standpoint.

(A Top Pick Oct 26/11. Down 14.28%.) The whole group is statistically extremely cheap and yet he thinks the market believes implicitly that oil is going to $75 and drilling is going to dry up. Raised the dividend so you’re getting almost 4% now. Probably a takeout candidate.

What she is seeing in the 3^rd quarter so far in Canadian fracturing are a few headwinds so you may see street estimates come down slightly in the coming weeks. Although she likes it, she may not be quite as bullish as the street.

(Top Pick Aug 22/11, Down 13.57%) sold when commodity prices started to fall apart. She will be getting back in at some point. Thinks there will be a little more basing in here.

Drilling companies in general are exceptionally cheap. Have come down a long way because there has been some margin pressures. Fracing fluids are starting to cost them and little bit more.