Sandy McIntyreFocus Energy TrustFET.UN.TOTOP PICKOct 13, 2006
(A Top Pick July 28/06. Down 12.5%.) One of the best management teams. The longer that gas prices remain low and the more development drilling is deferred means the ability to fill storage next year becomes compromised. Betting on 2007/2008 gas prices. Strong management.
A great gassy trust, very low cost. The majority of their properties are outside of Alberta so the royalty review process does not impact them significantly.
(A Top Pick July 13/06. Down 23.2%.) Drop was due to natural gas prices. Still likes. Low payout ratio. Excellent quality properties and excellent management. Long-term investors will do well with this.
May be better to move to the Canadian oil sands (COS.UN-T), or Vermilion Energy Trust (VET.UN-T), and Baytex Energy Trust (BTE.UN-T) for long term beyond 2011.
(A Top Pick Oct 13/06. Down 19.3%.) Have 4 to 5 years of development work in front of them. Bullish on 2008 gas. Don’t buy now, but there will be an opportunity between now and the end of the 1st quarter.
If the unknowns surrounding income trusts where cleared up, this is one of the ones he would buy. Increasing production on a per-unit basis, year-over-year. Good management.
He has lightened up on the gas-oriented trusts recently because of near-term weakness in gas. However, feels that gas will be going up and this is one of the better names. Recently made a large acquisition giving them good diversification.
Has a tiny problem with the income trust world. Oil/gas trusts commodities are depleting. Prefers companies that have a hard asset value. This trust is a high quality and will probably do well.
Pays 8.5%. Cut their distribution from $.19 to $.16 per month. Gas weighted. Now is not a bad time to be buying gas. They are a sustainable trust and are not living beyond their means. Top quality management team, excellent properties and reasonable payout ratio and debt levels.