Nuvista Energy Ltd (NVA.TO)

Trading volumes? The lower the share price, you have to trade more for a given trading position size. He thinks this will be a $4 stock down the road. Volatility in oil prices has caused investors to digest the market developments. He thinks oil prices will consolidate around here for a while. He likes management and the asset quality. They are immunized against weak cash flow. Well results in the last quarter were awesome, telling him the Cenovus assets they acquired are now validated.

Natrual gas prices? The 2021 strip price for AECO is over $2. That will work for strong balance sheet producers like TOU, NVA (60% natural gas), and ARX.

There is a rumour that Paramount has acquired a 9% holding in Nuvista. Paramount is outspending their cash flow and announced, if required, they may look to sell off assets and this could Nuvista. Both companies share prices have been pushed sharply lower as a result.

VII-T vs CR-T? He would stay away from CR-T due to its debt level. VII-T has a good management team, but its slow down in growth highlighted their 50% decline rates in existing assets. This causes too much of their cash flow to still be required for maintenance. He would prefer NVA-T, which trades at a lower multiple of cash flow, has a better balance sheet, and lower decline rates on production.

This one depends on your view on gas. He would put this up there with the half-dozen Montney focused names. Has been very impressed with the ongoing improvement of well results. Definitely top tier.

(Top Pick Feb 05’15, Down 12.90%) He got about an 8% yield. It has performed quite well, year over year. They have most of their assets in Saskatchewan and the Canadian pension plan is a partner. It should be the end of the axe swinging.

They have been having some great success in the field. They are a growing concern. They hit a sweet spot. Their net backs are approaching $15. Debt is no longer a concern. They also had some great hedges in place.