Stock price when the opinion was issued
He's a long-term natural gas bull; it's the fuel of the future, and LNG Canada is about to start. TOU has a good CEO and good inventory and pays a high dividend. That said, TOU is not his favourite nat gas stock though holds a lot of shares. TOU is more about dividends. TOU buys a lot of companies which creates an overhang and doesn't allow the share price to perform as well, so it lags its nat gas peers.
Nice recent production and FCF beats. High-quality company. Diversified marketing portfolio. Are we in the sweet spot for natural gas as TMX starts to come online and Canada starts to export LNG? He thinks the answer is yes. Trading in line with peers, nice production and FCF growth. Balance sheet's in good shape. Nice dividend. Payout ratio is 90%, pretty safe.
Buy when down. Safe to put some $$ in right now.
Harks back to his view that total return is important. Natural gas is up ~50% from a year ago. With LNG Canada coming on, anticipates nat gas prices improving materially through the end of the year. Business fundamentals are best in class. CEO has been buying shares. Not a lot of flash, but they know what they're doing and keep growing earnings per share.
Despite the name, Canada's largest natural gas producer at ~13% of the total. Likes its capital discipline and lean operating efficiency. 21% stake in TPZ. Early mover to secure market access to delivery hubs on US and Canadian West Coasts. Consistently able to get higher pricing than peers. Generates lots of cash.
Cargo shipping from LNG Canada (as soon as this weekend) will benefit the whole sector. Kitimat project has potential to meaningfully shift supply/demand balance of Western Canadian nat gas, due to Asian demand. Yield is 3.10%, and there are special dividends too.
It's actually natural gas ;) There's an incredibly low gas price, as there's just too much gas in the system. There's an idea that by 2026, there might actually be a tighter gas market for the first time in a long time. Special dividends equivalent to the current yield. Collect your dividends and wait for that catalyst. Incredibly successful Canadian story.
We're now exporting gas to other countries. Highest-quality company he can find while he waits for the catalyst to kick in. Yield is 3.2%.
Nat gas prices still under pressure. Management and structure are set up for success, even in this environment. Minimal debt, special dividends. Management owns lots of shares. CREW acquisition cashflow-positive right away. Long-term thinkers.