Rick Stuchberry Cardinal Energy Ltd CJ-T TOP PICK Dec 21, 2016

He owns it in his RRSP because of the dividend. Company's done a decent job. Need oil prices to go up to bring excitement to the stock price. It was noted that the company has a negative carbon footprint. Yield is around 10%.

Many energy stocks are going sideways. This is in a trading range, which is not bad and you can hold onto it. Maybe you can be this for a trade or wait for a breakout for the long term.

He never buys a company on the expectation that it will be bought out. Good exposure to medium-heavy oil. Very manageable debt levels. Older, higher-cost assets, so it needs a higher than average oil price. If you don't care about capital appreciation and just want the juicy dividend, it's not the worst name.

Spending more money on a project, free cashflow won't be for 2 years, and market's attention span is very short. Concern they'll be burning cash to pay the dividend. Balance sheet indicates sustainable dividend, unless oil price really nosedives. Insider buying. Too small for him. Yield is 10.5%.

For the mid-cap Canadian companies in the space with higher yields, be very careful. If you're looking for dividend sustainability, we've gone through a couple of cycles in the last decade -- dividends have been both increased and reduced. Yield is 11%.

In the space, he prefers FRU.

Pays a fat dividend, doesn't chase exploration and is rewarding shareholders. Trades to $8 when oil prices rise. They produce light, sweet crude, so it won't benefit as much as the heavier oil that's exported to Asian markets. He's bullish Canadian oil. CJ is well-managed, though.

Are leaning on their balance sheet to pay their dividend, which they can do. Their Canadian oil sand project should give them more free cash flow and they will fill in that dividend. Good if you buy dividend stocks, but he wants share price appreciation too.

Outspending free cashflow, using debt to finance dividend, not his preference. Gets concerning if oil price drops. Not sustainable for the next year and a half. In 2026, the cadence of capex reduces and the dividend becomes sustainable. Yield is 10.1%.

Look elsewhere. You may sacrifice 2% on the dividend, but you're getting one that's much more sustainable.

Dividend is not safe. Company spending too much money on new oil project. Company expecting to use debt to pay dividend. Falling oil prices not good for company. Better options for income oriented investors. 

Sentiment remains challenged in the space (a common theme today), even though the Energy Index is up about 20% YTD. People are hiding in large caps, with few funds coming to small- or mid-caps. Hard to see it outperforming. Yield is 10.7%, pretty hard to replace. Not a name for new money.

Look at his Top Picks today, and then decide if you want to let this go for tax-loss selling.