Precision Drilling (PD.TO)

It is a very good company. They have very high debt. The balance sheet is severely stressed. There are other names you can go to.

To him this looks like it could be setting up for a positive move. Recent highs and lows are progressing. I recently broke through a significant high and could be nearing a good buy. He would rank it 7 out of 10. He would leg into it cautiously.

If capital returns to Canada following the pipeline announcement, this will do well. He thinks PD-T has a long way to run as they have been upgrading their fleet. Yield 0%. (Analysts’ price target is $5.57 )

It supplies rigs to oil exploration companies, so it's a highly cyclical name. Too unpredictable for him. His style is buy-and-hold long-term, but it looks like it's been turning up as oil rises.

This is one of the most liquid services company in Canada, which gives it a slight advantage in the space. Their recent quarterly earnings were on line. They have the best technology and this is leading to higher daily rents – double from the lows. Free cash flow is solid and this will help drop debt levels.

He does not follow this closely. They have an advantage being exposed to the US, where drilling is going to be more robust. He would stay away from the Canadian service companies as a whole. If you have it, hold it.

(A Top Pick Mar 17/17, Down 37%) He said it was higher risk when it picked it. We need a pickup in activity in the oil patch. They have not participated in the US recovery as much as people would have hoped. At these levels the down side is limited but the upside is more substantial. It is not a safe harbor investment.

A bit of a contrarian pick given the high level of debt. He thinks they are starting to pay down $300-$500 million of debt. It is close to a ten year low and believes the market has pushed the price too low. Management feels comfortable and reports day rates are increasing. Yield 0%. (Analysts’ price target is $5.39 )

This company has a lot of its business in the US, where the Bakken and Permian plays are very prolific. The stock could really run, but the problem is the debt to equity ratio and are carrying $1.8 billion in debt. He thinks the stock will drop below $3 before rallying to $7 next year. There are other names in the drilling space that are better like Trinidad and Ensign.

This company has a lot of its business in the US, where the Bakken and Permian plays are very prolific. The stock could really run, but the problem is the debt to equity ratio and are carrying $1.8 billion in debt. He thinks the stock will drop below $3 before rallying to $7 next year. There are other names in the drilling space that are better like Trinidad and Ensign.

She doesn’t any of the oil services companies because of the overall negative view of the Canadian sector at this time. She did own it a few years ago but sold it and is waiting for the sector to recover before buying again.

It is on his coverage list. His problem is the balance sheet. It is trading significantly below book value. The debt is too high.

(A Top Pick March 17/17. Down 23%.) The largest drilling company in Canada, and there are opportunities beginning to open up in the energy sector as prices improve. There’s been more drilling activity of late. They have an Association with Schlumberger, which gives them access to a lot of good technology. Of all the Canadian drillers, this is the one he would prefer to own.

He prefers Trinidad. The PD-T debt is his concern. The company is focusing on paying down debt, however. On a cash flow multiple basis it is cheap and it trades at a discount to book value.

They have great technology, a great fleet and a better balance sheet than in the past. They need to show they can grow the business. The risk/reward is skewed to the upside. He bought calls last year.