Joanne A. Hruska, CFA
Delphi Energy Corp.
DEE-T
WATCH
Feb 05, 2018
They have a higher than average level of debt but trade at a low multiple. If we have low gas prices for quite a while they will have trouble. If an LNG project gets announced in the next 3 to 6 months it might give investors hope we can get rid of some of this gas. She likes what they have done.
You are going to see the big bounce in production in 2018. The problem is the balance sheet: debt issues. They are about 40% oil and liquids and 60% gas. If it backs off it would be a good buy.
This is one of his top plays in Western Canada. Delphi has done a gone job with its balance sheet. They’ve been moving more to liquids and this will be one of the takeover candidates when LNG exports finally start happening.
Auto parts have been a big target in the NAFTA war, so they received a lot of relief when that was signed. Auto stocks are cheap but could face a rough year ahead. We're late in the auto cycle. Don't need to sell. Hold. Don't buy.
It is very cheap. Q3 they had issues with facilities. They are now resolved. It is trading at 2 times 9 months cash flow. Markets are throwing companies away indiscriminately through tax loss selling season.
They are bringing on new wells. They are generating 30 cents in cash flow and trading at $0.38. The stock has been devastated because of debt. It is a junior name. It is a very cheap stock. It is on his action alert buy list.
A Montney producer, which did not hit the production levels the market expected. They have had four good wells come online and more production increases to come in Q4. Their debt needs to be cut by $100 million before he would be interested. The market is penalizing companies that can not get their debt under control.
It is a liquids rich player with very high liquids content. The problem is that the market cap is below the radar, and the debt is high. It was a $4 plus stock when we had decent gas prices. They are looking to bring their debt down. He thinks the company will survive. They've been hammered, however.
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They have a higher than average level of debt but trade at a low multiple. If we have low gas prices for quite a while they will have trouble. If an LNG project gets announced in the next 3 to 6 months it might give investors hope we can get rid of some of this gas. She likes what they have done.