Canadian Oil Sands (COS.TO)

Not a name for him. Balance sheet is a little levered. The dividend cut put the stock down. There could be another cut coming.

A higher cost producer, so he would not Buy it yet. Let crude bottom first. There is no huge rush to buy this. Because it is a high cost producer, the dividend is somewhat susceptible. He has others that he would prefer.

He does not want to be in companies that are paying out more than what they are taking in. This is one of them. If oil stays at around $70 or goes lower, they are going to have to slash the dividend. Prefers to stick with the conservative ideas.

Where it is trading today, he would not necessarily sell. If you are looking to participate in the oil sands, he might choose a different vehicle, but overall this company is at a level now where it looks reasonably valued. An extremely long-term play.

This one breaks every technical rule that he can think of. When you had significant support at $20, the stock tested it over and over. This meant that people were buying it every time it got to the support level. It would hold or bounce off of it to the upside. Had a nice bounce earlier this year, but recently it fell and broke old support, really important support. A pretty ugly picture. Like a lot of energy stocks, it will probably have an oversold bounce. He wouldn’t be a long-term buyer of the stock.

With almost every energy company, the sustainability of the dividend is highly predicated on either issuance of preferred shares or convertible debentures to make the payment, but not really for a stronger quality in terms of cash balance and cash flow from operations. The sustainability of the dividend for the 1st or 2nd quarter, without any issuance of stock or preferred shares, is questionable for this company.

Sold it because he wanted to lighten energy exposure and it was his preferred candidate to do this. It is a pure oil sands producer. They cannot increase their reserves. The dividend is pretty safe at 8%.

This is a public play on a direct interest in Syncrude. Had a terrific cycle in 2003-2007. However, it is not in charge of its destiny. Doesn’t have the same capital allocation ability like a Suncor (SU-T) would. Would prefer others.

Not one of his favourites. The problem is that it seems to have an aging infrastructure. They have fires and explosions. There always seems to be something going wrong. Have lots of capital requirements in the future that concern him. Prefers others.

He would rather play the oil sands through some of the other players. They don’t have a lot of control over the fields they are participating in. If oil prices remain compressed as they are, you would have to question their ability to maintain their distribution.

This is just a “pass through” for the oil price. They own a percentage of the oil sands project. Operationally it has not been the best, running at a 65% efficiency rate where 80%-85% would be ideal. With oil prices above $100, there was enough breathing room for them. If there is a prolonged oil price drop, he expects to see market starting to fret and the dividend may be at risk. Large company with a pretty solid balance sheet so there isn’t a big risk. He prefers others.

Likes the long term prospects very much. Their two cap-X projects will stop spending money by the end of this year and there will be lots of extra free cash flow. It yields fairly nicely so you will get incremental income from it.

Likes it. Moves with the price of oil. Good things are happening there. Their cap-x is coming down so they could bump their dividend in the future. If oil gets to $80-$85 that is a lower risk entry point for this stock. Doesn’t see a dividend cut. If oil goes to $95 he sees a dividend bump.

(Market Call Minute) Limited room for growth.

The biggest holder of Syncrude, which has had a number of operational issues, with a lot of unscheduled maintenance. Most of the cash they’ve had to use for capital expenditures starts coming down next year, which should be very good for the cash flow. This should allow the dividend to start to grow again. 6% dividend yield.