Ryan Modesto Crius Energy Trust KWH.UN-T BUY Jan 02, 2018

(A Top Pick Apr 11/17, Down 17%) A short report came out yesterday. It is a higher risk income stock. Around the 9% area. The usual concern is that they sell Nat gas contracts and there is a high customer churn. It is not a new story. That is just what they do. There is concern on their payout ratio. They just acquired a company in the US that should help boost their cash flows.

Disappointing quarter, so the share price dropped. Dividend is well-covered, though it's over 10%. Some growth would help them.

It is a higher risk income stock. They sell energy contracts that you can lock into. They have to make more customers than they lose. Their recent quarter looked good and alleviated a lot of concerns that existed with the company.

Just Energy vs. Crius: Just's chart hasn't performed well. It trades at a fair 5x EBITDA. Problem with these companies is that they're an energy marketers, but the market believes it better to own the client (producer), not the marketer. You're much better with Cruis: activist investors moved onto the board, better yield, less levereg.

The high 11.6% dividend scares him. It could be adjusted. That said, he'd buy it. It turned when energy fell then flattened. KWH itself is in an interesting spot. Buy or hold.

The stock has been really weak and there has been no news to justify it. They raised the distribution in January and the payout ratio is still okay. It looks like sellers are selling only because it is down. He believes management and thinks it is okay – although does not like buying into negative momentum on price. Yield 13%.

Shares are seeing a big drawdown driven by fear. But their recent quarter was good with revenues up and dispelled some of those concerns. Pays a 13% yield, with 4x cash flow. The yield is a red flag. Maybe 8% is appropriate.

Just energy vs. Crius Energy Trust: Similar companies, valuations and dividends. He prefers Crius because he knows it better and are shifting their client portfolio to more commercial and higher-margin companies. He likes this shift.