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TSE:PSK
This summary was created by AI, based on 3 opinions in the last 12 months.
PrairieSky Royalty (PSK-T) has garnered attention from multiple experts, highlighting both its defensive qualities and challenges in valuation. Experts note that while the company is exceptionally well-run and has seen strong performance, it trades at relatively high multiples, indicating a lack of compelling upside at the current price. The company currently offers a yield of around 3%, which is not seen as overly attractive when compared to other investment opportunities. Additionally, opinions vary on the fair multiple for royalty companies, with some experts suggesting only modest potential for future gains, while others believe the defensive nature of the stock could appeal to investors focused on stability amid volatility in the oil market.
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. A solid company for the sector. Balance sheet and cash flow looks good. Growth is positive and they managed the pandemic well. They cut dividends but it is now much higher than before. Their recent deal is good and is the right move for the company. Unlock Premium - Try 5i Free
(A Top Pick Mar 20/17, Up 4%) His only energy stock. It is not a producer but is a royalty company. They missed on production guidance by 900 barrels and they lost 8-9% and it makes no sense to him. He likes it. It is a way to have oil exposure without capital risk. It is nice light oil. The balance sheet is impeccable.
One of the oil patch casualties that has actually done okay. He likes royalty structures because you don’t have capital investment risks, and this one has no debt on the balance sheet. Oil price recovery gives them torque to the upside. During the horrific oil environment of 2015-2016, they proved their ability to generate good cash flow. Dividend yield of 2.7%. (Analysts’ price target is $34.75.)