Freehold Royalties Ltd (FRU.TO)

FRU is such a low-cost producer, it hasn't benefited as much as marginal producers have in the uptick in oil/gas prices. So its margins haven't increased as much. FRU asset package is so good, he's happy to own it despite this year's price action. He likes both names.

Excellent company that owns shares in company. Strong commodity prices. Expecting strong Q3 results. Very good management team. No wellbore liability risk. Diverse asset base across North America. Current share price a good place to buy. Strong long term investment. 

Excellent company with safe dividend.
Conservative balance sheet with strong management team.
~7% dividend yield.
Owns shares in company.
Expecting share upside. 
Trading at discount to PrairieSky Royalty.
Company needs to prove that they can acquire assets. 

Super cheap. As a royalty company, rock-bottom production costs. Only costs are running the office, which comes to about $5 a barrel. They make money in every environment. Yield is 7.53%, which is about 60% of free cashflow.

High quality, relatively safe dividend. Energy prices should remain firm, and FRU will benefit. Oil usage at all-time high, have to rebuild US reserves. Prefers CNQ and TOU for growth, though dividends are not as high. Yield is 7.5%.

Looks to be on a downslide. Consolidating, so probably won't go much lower. Buy a bit, hoping for a breakout to the upside. If drops below $13, will probably be more sellers than buyers, so be careful. Yield is a decent 7.8%. 

Excellent business model that is asset light (does not own wellbore liabilities).
No exploration risk.
Safe dividend - good for defensive investors.
Does not own shares at the moment.
5-10 year time horizon is a good investment.

Good to hold 5 years or longer, but it depends on commodity (oil) prices. He's bullish oil long term, because there's a lack of investment in oil globally. It can pay 7.6% dividend for a while. Their royalty structure means they are capital-lite and not investment much.

Likes the dividend. Less risky than some smaller plays. Be patient. He doesn't believe we're going to be using less energy in 5-10 years. Exit from fossil fuels is a 3-5 decade process. 

A solid pick over some of the other Canadian royalty names. He wants more risk now, as that's where the opportunities are. He wants names that have sold off aggressively, with a good dividend and a bias to grow that. He wants more leverage to a more bullish oil price. See his Top Picks.

Fine. Has asset growth, but you're paying a premium on royalty companies, so he prefers the producers like CPG or Baytex.

He likes natural gas producers now, with commodity prices depressed by temporary factors, but won't effect the western Canadian producers which will benefit to export pricing. Likes FRU long term with less risk than an outright producer. Pays a 7% dividend yield.

Royalty companies like Freehold and Topaz have high yields of 6% to 7%. For exposure to energy they provide lower risk but still have some exposure to the upside and downside of the commodities. If you want to buy a producer with greater risk you could look at Headwater, Whitecap or Arc Energy.

Fine, good income. Lots of potential growth. Valuations are higher on the royalty companies. He'd rather roll with the producers, heavy oil or core oil, with 3-4x operating cashflow. They also have a lot more ability to pay out. Whereas royalty companies are 6-8x, just for a better and more consistent payout ratio and not as much operational risk. Yield is about 7%.

Is under pressure with a low in March. Underperforming the markets. Expect more selling. Will be rangebound at $15-16.50