Alex Ruus Freehold Royalties Ltd FRU-T PAST TOP PICK Nov 15, 2024

Lots of people were unhappy with the latest equity financing. Typical for income-focused securities. REITs and royalty companies tend to pay out most cashflows to shareholders; so when they want to do something, they need to raise equity. Makes it unable to deploy a counter-cyclical playbook the way a CNQ can. And in a cyclical industry, that's what creates the most value.

Just starting to break support. When it's this early into a break (a few days or a week), you have to cut it some slack. Sometimes you can get head fakes, so be careful. The old low from 2022 is a support level, and there's more support just above that. 

At this point, it's hard to tell. Give it a tiny bit of time. If it doesn't recover quickly, he wouldn't want to own it.

Likes exposure to energy and energy prices without the exploration costs. Stock's come down on issuing equity for recent acquisition. Substantial dividend in the space, minimal risk. Good value. Compelling yield of 8.3%.

No operational risk with liabilities from wellbore. High margin business. If "Drill baby bill" materializes, will not be good for company. Dividend is stable. Most of returns have been generated by dividend growth. Good for yield seeking investors. 

They just bought a US company. More than 60% of cash flow comes from the US, so they are better insulated from tariffs than peers. Pay over an 8% dividend. Will convert USD revenues into CAD, which is good. Oil prices should be stable.

Believes dividend is safe. Strong business with good capital discipline. Royalty business capital light. Under valued business. 

A major holding. It yields 9%, which is defendable even at lower oil prices. It's a royalty company, so there's no exploration risk. They have expanded into the US; hopes their next quarter shows US stability. They have done accretive deals in the US and are expanding in the Permian, because there is less room in Canada. Expect modest capital appreciation, but you get a stable 9% dividend. Good for income investors.

Support level around $13 was broken. Not great news from his viewpoint. He'd want to know if the company is stable enough to continue paying the dividend. If yes, it'll probably move up again.

Small position for her, actively traded. Energy royalties are still a steady play. A mid-tier champ. Zero operational risk. Dividend hike, so she doesn't see it being cut. Yield is ~8.5%. Oil above $70 keeps royalty cash flowing. Drop in crude price or a global demand wobble would impact it. Value of 10/10, fundamentals 10/10. 

Won't double this year, but likes the consistent 8.3% dividend yield. As a royalty play, doesn't have the same commodity exposure as producers, though can be impacted by negative sentiment in the energy sector. Recent acquisitions in US, and this seems to be the new focus. Great risk/reward.