Pembina Pipeline Corp (PPL.TO)

(A Top Pick Dec 29/14. Down 29.02%.) Suffered because of the collapse of the midstream product prices, etc. They know that, so are back to “take and pay” or “cost of service” up to 82% versus the 70% it was before. Stay away from this until there is firmer pricing action in energy.

(A Top Pick Dec 12^th/14. Down 19.68%.) Got stopped out in July. He is just waiting to get back in. A great company. All of the pipelines are monopolies.

Has not owned this, but would probably look at owning it. Selling off in a lot of sympathy with what is going on in the US, where some of the names dropped drastically and where they have cut some of their dividends. Looking interesting for the first time in a long time. It certainly looks like it is near the bottom.

This has been under a lot of pressure, as has most Canadian energy companies. His favourite is Suncor (SU-T), but this one might be a good trade here. They were oversubscribed on the new issue. You’re going to see a lot of investors coming in and looking for trading opportunities and to do some bottom fishing. This is a midstream company that does a lot of processing as well as pipeline aspects. The dividend has been secure so far, but it could be in question. He would wait and see.

(A Top Pick Dec 5/14. Down 11.44%.) Pipelines have held up reasonably well, but even they have not been performing that well recently. He has slimmed down his positions in the pipelines. There is a general feeling that the oil industry in Western Canada is in for an extended period of contraction. Dividend yield of 5.4%.

P/E ratios are high on the pipes. He has been adding to it over the last couple of months. The dividend is increasing at 5-10% per year. They have a good book of construction projects coming on.

People buying this are looking for a dividend yield. It is less sensitive to oil prices than interest rate increases. They are paying out what they are earning.

He likes this at these levels. It represents good value. It should increase the dividend around 5% a year from here.

Accept an offer to convert debentures for shares? He would be onside with this. This is one of the best management teams in the pipeline business. The company has rarely traded at a discount relative to its peer group on a price to cash flow basis. They have some of the best assets in the business. Also, most of their revenues come from “take or pay” contracts. 5.3% dividend yield.

This, and others like it, has gotten hit by association with energy, but the pipeline guys are just a toll on volumes on the way through. Pipelines are generally full, so where do you get your growth from? He thinks Enbridge (ENB-T) has the best growth of the pipelines.

When we become a little more disposed to energy, this is a Buy.

(A Top Pick Aug 24/14. Down 26.92%.) Had purchased this August 17 and sold it October 22 for a loss of 4.5%. It is something that is starting to find a base and he is starting to poke around this whole space. There are a lot of really good names that warrant attention.

A mid-stream company and services the energy industry with existing capacity. Generally not as exposed to the energy cycle as oil companies are, but more exposed than Enbridge (ENB-T) and TransCanada (TRP-T). Just sold his TransCanada as he feels interest rates sooner or later are going to go up and it could be vulnerable. Doesn’t see the dividend not being safe, but as far as making any money on the stock in the near term, he doesn’t see it.

A steady cash flow business. In this environment, if you want to be involved in the energy sector, this is probably a good way to do it. Their pipes are mostly full and are usually “take or pay” contracts. If you want to be involved in the infrastructure sector of energy, this is probably a good way to do it. Gives you a nice dividend.

(Market Call Minute) The lowest risk part of the energy chain, but he would avoid the whole sector. The dividend will get paid, however.