Peter Brieger
TKE Energy Trust
TKE.UN-T
BUY
Aug 17, 2005
For pure gas income trust plays, prefers TKE Energy Trust (TKE.UN-T), Progress Energy (PGX.UN-T), Thunder Energy (THY.UN-T) and Peyto (PEY.UN-T). In the producer area Storm Exploration (SEO-T) because it was incredibly cheap at $4.60. Would sell when it gets near $7.
Doesn't know it well. Yield is pretty high at 14.5%. Would have to do a lot more homework on as he would be suspicious with the size of the yield. He also thinks there's a large number of exchangables outstanding which could result in some dilution.
Heavily weighted towards natural gas. Payout ratio to the end of the 1st quarter was 78%, but with the prodcution coming on it will be closer to 52% which is where the company wants it. Debt free. Good reserve life. Low coverage, but as it matures, will be discovered by the street.
Has a reasonably good slate of prospects in front of it. Debt is a little high. Distribution arrangement is a little high. Pretty illiquid for his holdings.
A major natural gas player. Yields about 14%. The payout ratio is going to drop to close to 60% this year. The major problem is that only one broker covers it and he is negative. Consolidation is going on and it could get taken out.
Has gone through a transformation through its merger with True Energy (TUI-T). Buying for new accounts. The merger increases their current production rate from 4,000 BOE's to 15,000. Yield of 12%.
TKE Energy Trust (TKE.UN-T) and True Energy (TUI-T) are entering into a merger. Would buy the new exploreco that will be spun out. Expects production will triple. Hopefully the street will pick up coverage on that.
True Energy (TUI-T) and TKE Energy (TKE.UN-T) are merging and he likes the deal. TKE by itself is about a 4,000 equivalent per day and this will go to about 14,000.