Suncor Energy Inc (SU.TO)

(Market Call Minute) Better returns in other players.

If Suncor announced sale of interest in the Voyager project to Total, it might have a slight short term impact but the price of oil would be a bigger factor. He is a buyer below $30 and a seller at $34

One of the few names in the energy space that he is relatively constructive on. Like management’s tone recently. Will likely increase their dividends. Willing to cut off some of their big projects that they’ve done, so Cap X spending is going to come down. Generates an incredible amount of free cash flow. Trading at very big discounts to their NAV. Right time to accumulate for long term investors.

(A Top Pick March 1/12. Down 10.44%.) Continues to like the fundamentals. Shorter-term they are facing the impact of widening oil differentials in Alberta.

(A Top Pick Feb 13/12. Down 6.95%.) Sold his holdings in November because of concerns on the US fiscal cliff debate. Starting to wade back into this little bit. Really cheap.

Valuation looks attractive. Going to have cash flow per share of about $6 a share as long as oil stays in the $90 range. Going to grow its production. Cutting the cord on some high cost production. 1.7% yield. Hoping there will be an increase in dividends.

He trades for clients. Likes below $30 and sells above mid $30s. Does not see that changing. Doesn’t think keystone gets done until 2015.

(Top Pick Jul 6/12, Up 10.95% Total Return)

Being in Canada, he only bothers with those that can grow their production. Can’t see the government allowing it to being a takeover target. He would be a little bit cautious with this one. Still owns a little bit.

(A Top Pick Feb 9/12. Down 6.57%.) There is far too much value to give up on this one. He has a model price of almost $60, and 86% upside.

Looks like a lot of energy stocks. Nice run in latter 2012 and now we have a lid. Finding support in the $31 area.

Missed on the last quarter because of 1) sued for $1.2 billion on a derivative contract and 2) main upgrader was down for a while. People should be focusing on the amount of free cash flow the company will be spinning off. Generating $2 billion of free cash flow both this year and next. Could be debt free in 2 years but expect they will probably meaningfully increase the dividend.

Canadian oil is locked in place and can’t get to world markets. Great company on an asset basis. He is lighter weighted than he was in energy and is not looking to put more money into the sector. If he was he would have to be a high-yielding one.

Stock pulled back because the earnings they just announced did not meet expectations. The primary thing they did though was to take a huge write-down in respect to their Voyager program. This shouldn’t have taken the market by surprise. Bulletproof balance sheet and some excellent prospects for future development production growth. Margins were probably a little thinner than people were hoping but lately, margins have been very robust.

(A Top Pick Dec 28/11. Up 22.41%.) Still likes. Growing its production well and delivering on profitability. Benefiting from the crack spreads.