Imperial Oil (IMO.TO)

(A Top Pick June 2/17 Down 8%). Going back 30 years, he has not seen valuations this low. Is capital simply moving away from this space? His model puts book value at $31.

There is flat production. It was $58 in 2008 so in almost 10 years you have not had a return on this stock. He thinks we will get a production report increase this Wednesday. Frackers are running full out in the US to bring in more production. The industry is hedging to lock in prices. Speculators are as high as they have ever been. You should be careful in oily names.

(A Top Pick Jan 19/17. Down 9%.) Had picked this because it was fairly cheap and fairly solid, as well as having a hedge through having a downstream company. This didn’t work out.

It has not made investors much money this year. Likely there will be a tax loss selling effect. He does not think there is a lot of return in it. SU-T would be much more appealing.

IMO-T vs. XOM-N. Oil is not going to take off in a big way but he has been buying oil on weakness over the last while. However he is now thinking of reducing his weight in oil. Now is not the time to step in. He would tend to stick with Canadian because of currency risk. They are getting over bought.

Lots of people like to own it because it is a big cap, but they don’t make a lot of money. It does not have the leverage to the upside like others. It is a conservative holding, it is stable. The stock does not reward shareholders very well and he prefers SU-T

This is the cheapest it has been since 1995. Thinks it is worth $57.58, a 50% upside. This is one of Canada’s best run companies. Dividend yield of 1.7%. (Analysts’ price target is $45.00.)

This has backed off. The high in 2014 was $56, and BV is around $30. He expects the stock to see lower levels.

Not favourably disposed to this as he would be to Suncor (SU-T), which seems to have a little more growth. This one is okay, but he doesn’t get excited over it.

This is cheap. If you want diversification then he likes this one. They have this huge guardian angel in the form of Exxon Mobil. It has not had the big bounce that some of the oil companies have had. He thinks only good things can happen with this one.

Even though it has fallen to $40, it is still an expensive story, when you look at it on an Enterprise Value to debt on a cash flow basis. An excellent quality company, and one of the best in Canada in terms of Return of Capital employed. She wouldn’t buy this for the short term, but would buy it for the long-term. There is not much growth coming from the story.

This has not made people money. The low in January was $37, only $3 away from where we are now. They have done a good job on their production out of Cold Lake. The refining business does very well for them. For a long-term investor, there is some dividend support. It is not going to make you the returns that others are, and there are better places to be.

If you are a long term investor, it is a fine company. In the short term they had some operational difficulties. Great balance sheet.

20 year hold? What has rallied has been the more speculative higher beta names. This is one of the most conservative integrated names. It has a heavy downstream piece, so it tends to do quite well. Doesn’t see tremendous strong growth, but it will plug along and do fine, and be a good steward of your cash. Dividend yield of 1.34%.

A great, solid, well-run company, and you can tell that by the way it trades. Free cash flow profile looks healthy, which is good for the investor. Because it is such a good quality company with less beta than the rest of the group, in a rising price environment you are not going to get as much appreciation as you would in some others. This is a company you don’t want to own coming out of a recovery. Also. refining margins are coming down. Feels some of the best upside is going to be in the pure play rather than in an integrated story.