Poseidon Concepts (PSN.TO)

Has been a tremendous win and he added two or three days ago. Appears to be a simple business. Possibly a bit of worry that the fracking industry could suddenly have to disappear because it gets forbidden. Be careful not to buy too high. A competitor would take 2 years to enter this space. Don’t fear competition too much just now.

Has had a good run. They found a lovely niche. Water tanks. You use a lot of water in fracking in western Canada. Highly profitable. The concern is that there are a lot of other oil service companies and PSN does not have a patent on the water tank. They have quite a following, increased the dividend. He has been short in it at various times. The concerns are when competitors start to offer a water tank; their margins will come down. Take profits as it goes up because it may not last – a quarter or two and then a day of reckoning.

Specializes in tanks for fracing fluids. Have done a great job in signing new deals. Great visibility. Very good yield at about 8.5%.

Produces tanks for fracing fluids. Have a patented fastening technology. Saves 80% in time in terms of mobilization and demobilization. Expect it will be a takeout candidate within a year. Almost 9% yield.

Manufactures tanks to store fluids, oil and water for fracing during drilling for wells. They rent the tanks out and it's paying very well right now. There are no barriers to entry to this business so be careful. They are paying a very high distribution.

Trading at about 6.7X EBITDA, which he thinks is a very conservative guidance. There are better values in some of the fracers that are trading at about 3.5X and drillers trading at about 4.5X. What is supporting the valuation is that they are paying a very healthy dividend. If you like the dividend then Hold.

Manufactures tanks for fracing fluids. This is truly one of the few growth areas in the market right now. Doesn't see any slowdown. A lot of momentum and there is positive change going on. (Also see Top Picks.)

Have a new way of designing storage tanks for the fracing industry. Environmental foot print can be pretty big. Can grab a huge market share and the stock can easily double.