Canadian Natural Rsrcs (CNQ.TO)

Spinning off tons of cash. One of the largest senior producers in Western Canada, and produce about a million barrels of oil a day. Phase 2 expansion in Horizon as well as its thermal projects, gives it a really good line of sight for amping up its production with another 250 million barrels by 2017. This will mean an extra $2 billion per year of free cash flow available, which could be used for increasing dividends or further asset purchases. Also, have a nice handful of royalty assets that could be spun out. Yield of 1.89%.

Chart shows the trend has been upwards. This has a lot of positive technical things that you want to see in a Canadian energy stock. The 1^st period of strength is late January right through until May. It then takes a break, and around the 3^rd or 4^th week of July it has another move on the upside. Look for this one to stabilize around current levels, but look for another opportunity to add as you get into late July.

Such a great operator, great growth profile. Analysts are still forecasting a $90 barrel of oil and $4 MCF for gas. CNQ-T has some more room to go. Prefers SU-T because of assets, but CNQ-T is also good. There are probably more legs even if oil comes off a little.

We have had a huge run in the energy sector. Has been saying for a couple of months that it has been overbought, but has been wrong. However, looking forward 5-8 years, oil prices are trading in the low $80’s, not $100+. So the outlook down the road is for huge supply in North America. Looking at a longer-term chart on this company, we have to recognize that we are up against some pretty major highs from past rally cycles, so he doesn’t see much upside here. We should get a pullback, in the lower $40’s, before getting interested. This applies to all large-cap Canadian names that focus on the oil sands.

His “Reduce” support line is $47 and his “Sell” line is $44.90. Chart shows a nice upward trend. All the moving averages are running up parallel. There was a little bit of consolidation around the beginning of May, and broke out to the upside in the beginning of June. He can see this continuing to go up.

On their investor day, it was driven home that the company is now in a position where they are going to be generating a tremendous amount of free cash flow, because the assets that they have are very long life, low decline, and have a wide variety of assets. Also, has been a very sharp increase in dividend payments they have been making. Yield of 1.88%. Large royalty portfolio could be valued at PrairieSky levels.

He likes this. Oil companies like this have had some pretty good quarters. It now has a habit of kicking money back to investors with share buybacks and dividends. Also, has some great property. Good management. Good balance sheet. The one thing that could be coming up with this is the royalty trust. (See Top Picks.)

Geopolitical tensions plus energy prices have driven this stock up. There will be dividend increases and 10% growth rate.

Pretty stretched along with the whole energy sector. Don’t chase it here. Futures show oil trading in the $80 range. CNQ should get margin pressures down the road. He has been avoiding the oil sector for a while now although he has been wrong.

Has some good short-term upside potential, and has been kind of leading the way in the energy sector. Its next technical resistance point is $52, and he expects it will do that fairly easily. It could easily get up to $60 or higher.

This is the quintessential energy stock that you want to own. You have oil, you have gas, you’ve got a dividend yield and you’ve got growing production. Cheaper than its peers. Yield of 1.9%.

Here’s a stock that has done extremely well. Is one of the preeminent oil companies in Canada, but at today’s prices, he would take profits. It looks reasonable going forward and is a core holding for many. Prefers SVE-T and SU-T and even TLM-T.

This one is a heavy weight in the index. There is a lot of momentum now. He would suggest that you move into it gradually.

Seems to be able to manoeuvre between the different sectors of the oil/gas market that are in favour. Well diversified between oil sands production and offshore natural gas. Well managed. You are going to see increased production come out of the Horizon plant over the next couple of years.

(A Top Pick April 15/13. Up 49.6%.) This is “best in class” large-cap in his opinion. Feels there is still $15-$20 upside in this stock in a good energy market over a 2-3 year period.