Peyto Exploration & Develop. (PEY.TO)

(Market Call Minute.) Great low cost producer. Natural gas is performing well.

Natural gas stocks over the past couple of months have done very well on the cold weather that we have had, which really ate into the year-over-year surplus in natural gas storage levels. Expects there will be headwinds over the next couple of months. Hoping to buy this on a 10% pullback.

Gas play. At an all time high. Gas stocks were high today because of the low temperatures. Doesn’t think we will see $5 gas this winter. This one is a good operator but you need production growth. Prefers another.

(Market Call Minute.) Likes this a lot. Great balance sheet. Natural gas levered but he sees natural gas over time creeping higher.

Well managed. Great landmass. Dividend yield of 3.25%.

This is the preeminent gas company. They are at the right end of the cost curve. Their gas makes sense down to $2 per MCF. If you are cautious on gas, this is probably the place to be because these guys would be the last man standing. Balance sheet is about 2X debt to cash flow but, if gas prices fall, this obviously gets higher.

Although he doesn’t own this, it is one of his favourites. This is more in the natural gas area and he would call it a natural gas stock. A bearish report came out today from Cannacord reducing the projected gas prices so the stock took a drop.

Have had good production growth over the last couple of years. Very well managed. One of the few companies that have been able to grow their production per share over the last 2-3 years. Still have lots of plays left with opportunities for growth. Nice dividend with the yield of about 3.5%-4%.

One of the great performers in the sector and he thinks they will continue to impress investors in their ability to execute. Doesn’t own a lot of this as he thinks there are better valued names, however, as part of an energy portfolio, if you want to have a core position, he would include this one in that category. They really have a handle on low-cost operating.

Feels that natural gas is going higher so is looking at the best way to play it. There are other stocks that show up really well but this one is a little bit cheaper but, more than that, they are an excellent producer. Should have 26% growth year-over-year. They set the bar on low-cost. Over the last year, their balance sheet and payout ratio has improved markedly. Good dividend coverage. Yield of 2.55%.

Natural gas with a 2-3 year outlook? The “go to” name in natural gas has to be Peyto (PEY-T). Great company and great balance sheet. Wonderful management. You may have to hang onto it for a couple of years. 2.7% yield.

A core holding for a decade. Well managed. Top Tier operating costs. A top performer. Great growth per share. 85% leveraged to Nat Gas.

He really likes it. They just announced a $100 million bought deal. There could be a pull back from this tomorrow. They are clearly a well managed company and have done very, very well in their exploration in the Nat. gas area. They are paying down debt. He is constructive on Nat. gas but you have to be patient.

(Market Call Minute) Liquids rich gas. Low cost producer with lots of opportunity.

Probably your best dry gas name out there. Cash costs last quarter where $.97 per unit of natural gas, which is very low. 2011 was an exceedingly tough year for the industry. Their margins were 36% versus the average of -8%. Top producer. His problem is that the expected payout ratio is still high at 196X this year’s number but declines to an acceptable range of 140 next year but that assumes natural gas stays at $3.50 level. Getting really pricey at 12X adjusted cash flow versus the group of around 9.