Enerplus Corp (ERF.TO)

Had been in this during its uptrend. When it broke the uptrend in 2014, he waited 3 weeks and then sold his holdings. Currently there is some potential consolidation, but the really big picture is still kind of bearish. Too early to make a decision. Give it another 2-3 weeks.

It is at EVB -3, so it is ‘In The Blue’. He suspects they need to write off assets. $1.11 model price so he will not touch it until they come clean with their balance sheet.

(Market Call Minute.) Not a bad company, but she sees better opportunities elsewhere.

The balance sheet is getting 3.5:1 debt to cash flow. The rig count has nudged up in the US in the last couple of months because companies hedged out and felt good in the last peak. He would rather see good return on investment decisions. He owns some, but it is not a top weight because of the debt level. The dividend is probably safe, but watch this August.

In this mid-cap energy space, it really seemed that at some point yesterday we had a bounce off, and he is really hopeful that yesterday was the bad day. These companies should probably not be paying a dividend right now, so it is within the realm of expectation that if oil slipped again, all these companies would cut their dividends to zero.

A well managed company. They are in one of the sweet spots. He likes it. The valuation goes with the rest of the market. The balance sheet is in good shape. He likes it.

One of the issues is not having control over the Marcellus. They are managing through it well. There are a lot of good things going on, but she is reluctant to step in. Hold it if you own it or move into something with better quality assets.

Has gone through a transition. Came down from 75% oil conventional production. At $60 oil some companies can increase their growth so they have increased their Cap-X budget. You can hang on to this. The debt level is a little high. He prefers the natural gas side of the energy space.

A lot of these things are leveraged to the outlook on oil. Any energy services stock is related to the commodity price. A lot of these stocks will perform poorly over the next two years. He can’t speak to this one specifically, but the overall space is going to go sideways and we will make a big base. You want to buy on weakness and sell on strength. It will go up and down within its range.

His model price is $3.06, a negative 76%. It is paying out $0.60. For this year, the mean estimate is that they are going to lose $0.55 and $0.08 for 2016 at current earnings estimates. He feels energy is going to go lower.

There are lots of stocks in the energy patch that gives you exposure to the same type of business. This one gives you exposure to Bakken oil, some Marcellus gas and some deep basin. A great company. There are other great companies where you can switch around and grab that tax asset of capital loss to lower your capital gains down the road.

Went through tremendous change. They are now concentrated in high valued Nat. gas. They found the sweet spot in the Balkan. They are valued at a very modest level.

His company has this is a sector perform and a high risk, with an $18 target a year out. Have reduced the rating because of their exposure to the US backing the Marcellus asset. He thinks the big hit is going to be coming on their shale play. Questions the sustainability of the dividend.

He sold earlier this year because of geography and where they were. Probably not the first one he would go to.

Third Quarter was a joy. Management changes and operational changes made a huge difference. He is impressed with how good a job they did of reconfiguring their assets. Should outperform its peers.