Russel Metals (RUS.TO)

This is a metals distributor, and they supply to the energy patch as well as some finishing for industrial companies. The stock will be hurt by the exposure to the energy service sector, whether drillers, pipelines, etc. Not sure if the dividend will stay in place if energy stays low. Yield of almost 6.6%.

He would be looking at good technical support at around the $22-$24 area. It has nice potential of about 60% from there. 6% yield is not bad.

The yield has gone up a lot lately because the stock has done very poorly. This is because about 30% of their business is oilfield tubing. That part of their business is going to be in very sharp decline over the next 6 months at least. It will have a bounce from tax loss selling. He has a small Short position in this, and on any bounce, he would be shorting more. 6% dividend yield.

Has a very solid yield. Good discipline in terms of paying the dividend out of increasing earnings. The stock has been hit lately by oil prices. He looks at it on a longer-term basis. This is a management team that has had a discipline of returning money to shareholders. An industrial name, so it will participate in a Renaissance of the North American economy. He doesn’t get overly fussed by the decline in the price of oil.

How much of its products are energy sector based? Hasn't followed this recently, so he doesn't know what its exposure is to the energy patch. A well-run company in metal distribution and fabrication. He would be surprised if it didn't have some exposure. Companies in the oil patch are starting their budgets right now. You are going to see budgets come down and one of the dichotomies of this is that the oil services sector continues to lead at a premium valuation to the producers and exploration companies, which doesn't make sense. There still is downside risk. Thinks this one has exposure into the US as well, and he is quite optimistic about the US. A well-run and well matched company and you are being paid around a 5% dividend.

Has followed it for a long time. It can be a very volatile business. Cash flow can go up and down a lot. If you are patient and have a long term horizon then it has generated a ton of free cash flow and they are shareholder friendly. There will be quarterly blips sometimes.

Metals and mining sectors usually pick up in the latter part of November. The chart indicates it is still in a down trend and has a little ways to go before reaching its support level.

Feels this has a sustainable dividend. Good company. The metric he uses on this is EV to EBITDA, and it trades at about 8.4. Trades at a premium to its peers, but it does have a very solid dividend. Its payout ratio is actually 63%. Solid balance sheet. Thinks they are going to have a very good 2nd half owing to the strength in their tubular good segment and stronger pricing and some demand recovery in their metals services centre. You can buy this on a pullback.

They service the energy sector. It is driven by steel demand consumption as well as what is happening in the energy patch. Feels the dividend is safe. Balance sheet is relatively strong. Before buying, she wants to see oil prices stabilize. There is still excess capacity in the steel industry in North America at around the 78% level.

His model price is $48.04, a 33% upside. This is in a precarious position here as it is at the top of his zone. It could have a correction back to $30.37. If it got back to $30.37, he would be a Buyer. If he owned this, it would be on his sell list.

Starting to look at this again. At first glance it looks a little bit expensive. What he likes about the dividend safety is that their cash flow is a bit counter cyclical, in that when things turn down, they reduce their inventory giving them more cash on hand to pay the dividend. What they need now is a continuation of the strength in steel prices coming up.

Distributors of metal. Narrow margin business. Stock has done very well, but it looks terribly expensive. Not sure what drives this stock.

Stock has acted incredibly well. Owns this primarily for its yield, and is quite comfortable that it will be maintained for a while. Stock is being driven lately because it is becoming a sort of quasi-oil service company (because of piping), so it is getting a kind of run that many companies in the oil service patch have enjoyed. A perfect type of stock for a portfolio. Historically pays dividends as a percentage of revenues.

Steel distributor and processor. Has an attractive yield of 4.34%. What is going to get this one going is industrial activity and steel prices. She prefers going a bit more global and this is strictly North American.

4.36% yield. It is not a business he would invest in because it is a very low margin, cyclical. The dividend is safe for now. Prefers others.