Obsidian Energy (OBE.TO)

Changes at the board level. Some people are reading a little bit into that as pushing the company to breakup or sale. Leverage has been higher than he likes and dividend has been less. They have struggled in terms of offsetting declines and the sustainability of the dividend has been a question. Prefers others.

Would love to own it , great company but the debt level is too high for her. Needs something to change before she would get back into it.. She used to own but sold about 3 years ago.

Similar to Just Energy. Doesn't like the business model.

This one has been quite a laggard. 2 new strong members have been added to the board which is good. Market expects a dividend cut because of their over 11% dividend.

Would have serious concerns about the sustainability of the dividend. Payout ratio is somewhere around 150%. Debt is very, very high, 3% to 4% in terms of debt to cash flow. They are looking at asset sales but there are a lot of sales in the market today and the close rate is very, very low.

(Market Call Minute.) Not keen about the sector. Decent company but struggling and over levered.

One of the big problems is that it is so big it has been scaling itself down. Management is getting its hand around it. There have been several departures of key people over the last year. It’s one of those companies that struggles to find a direction that investors can hang their hat on. If you are content to hold for 2 or 3 more quarters, you’re probably going to be okay. However, there’s nothing that will move the needle on this.

Stock performance has been horrible. Have spectacular assets but it is a confidence factor. Market, because of where the yield is, has zero confidence in their ability to sustain the dividend. Part of the negativity comes out of historical capital efficiencies and the company has suffered because they have been deemed to be inefficient. Also, has too much financial leverage. Sold his holdings. Thinks there is big risk of a dividend cut.

Would avoid this name. There is quite a bit of near-term risk to the dividend being cut from what he understands. A big, Canadian, diverse oil and gas exploration/production company. Suffering from Canadian crude prices, weak natural gas prices and some tough times ramping up some of their operations. One to keep on your radar screen and look at after they have reduced their dividend.

One of the largest light oil producers in Canada, especially in the Cardium region. Stock has gotten completely beaten up on the risk of a dividend cut. Have been piecing out some of their properties so they are able to extract some value out of their properties. At these levels, he would be Buying.

Has had a tough time of it the last year or so. It is being discounted to the point there is not much downside risk and if there is any pick up in commodity prices they will have some recovery from here. Owns some personally. Not sure if the dividend is going to continue for ever but doesn’t see them cutting it in the near term. It is a company that could recover from here.

Have a lot of good assets, especially long-term oil that they could develop. This would give them a lot of upside. From an asset point of view, they are pretty cheap but looking at the current production cash flow, especially considering how much debt there is, he doesn’t feel this is a safe place to be. Dividend distribution is at risk.

If you give him 5 years, he could make a bullish case on this company. It looks like they have stalled in terms of production growth. There are other more compelling names.

(Market Call Minute.) Have been doing a much better job of focusing in on their resource base and figure out what is working and what is not. They need a good operations person in here.

Sold his holdings at around $11. Doesn’t think the 10% dividend is particularly sustainable. Have a fantastic asset base but the company hasn’t seemed to be able to do much.