Opinions
Benj Gallander
Painted Pony Energy
PONY-T
DON'T BUY
Oct 27, 2015
$4.780
Stock price when the opinion was issued
oil
gas
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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.
oil
gas
DON'T BUY
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.
oil
gas
Oil and gas is a great sector to invest in as a contrarian, if you can find the right ponies to play. Thinks this has lost money 3 years in a row. Their share count has just about doubled in the past number of years. They have a number of problems they have to deal with in terms of oil/gas prices. Thinks it has a lot of upside, but at this point in time it is premature to invest.