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Opinions Bill Bonner
Painted Pony EnergyPONY.TOTOP PICKMay 27, 2015
Bill BonnerOwned
$8.21
Stock price when the opinion was issued
$0.69
As of Oct 08, 2020. Market Open.
oilgas
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He is bullish on Albertan-based natural gas because we have declining production and supply, increased take away capacity and inventories are at a 10 year low. The winter will eventually come and then there is the prospect of depleting storage. A lot of Nat gas companies have hedged away their Alberta gas exposure. Pony still leaves him a little uncomfortable, however. He likes BRK-T, TOU-T and ARX-T. The balance sheet of PONY-T leaves him pause.
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BUY
They have significant assets in the core area that will benefit from LNG. They had a tough second quarter and production came in because they shut in some production. The fourth quarter is going to be good. He thinks they can buy down debt next year. It is a higher beta stock and not owned by institutions. They could be a takeover candidate 3 or 4 years down the road.
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BUY
Results are not out yet because of a pipeline issue on the West Coast of BC. He thinks their volumes will pick up again as the pipeline issues are resolved. It is a very cheap stock at one and a half times cash flow. We need LNG takeaway capacity on the west coast, which will benefit them in 2024. We are probably going to have the lowest storage levels in a long time in North America due to cold weather. And Canadian Nat Gas prices are above $3 right now. It looks like cold weather will go on a little longer.
oilgas
(A Top Pick July 16/14. Down 35.05%.) Altagas (ALA-T) made an investment in the Company, which gave them access to a gas plant that will be built in 2016. This will take their production from 16,000 BOE to 40,000 BOE in the next 18 months to 2 years. That is a huge lift. With Altagas, they don’t need the LNG play to move their gas to market. They make about a 15% return at $2.40 of MCF.