Vermilion Energy Inc (VET.TO) Buy, Sell or Hold

Vermilion Energy Inc (VET.TO)

17.59

-0.12 (0.68%)

as of Sep 18, 2026, 6:34:07 pm Market Open.

585 watching

COMMENT

ARX vs VET ARX holds super high quality liquids assets in the Montney formation. VET has a more diversified production slate including Australia and the Netherlands as well as Canada. The US has shut in 1.4 million barrels a day, this has reduced associated natural gas production. This will tighten the natural gas markets making it much more bullish. This is helpful for ARX, more so. He has not been a huge supporter of the VET management team and is less bullish on European natural gas markets (where VET is more active). ARX also provides a better dividend stream.

DON'T BUY

Exposure to Brent pricing? He has suggesting selling this for years now. He thinks the balance sheet is in question by how the market is pricing it. He expects to see sizable write downs. He is not sure if they will be able to survive. Anything here is speculative.

PAST TOP PICK

(A Top Pick Apr 25/19, Down 83%) With an exposure to European natural gas markets it was attractive. He sold last June into ARX when it began to collapse with other energy holdings. They have had to restrict or cut their dividend several times. The energy space will continue to be a tough environment.

COMMENT

Fed bailout? He has no idea yet if VET or PXT would qualify if there was a Federal government incentive. He does not expect a bailout; rather, a lump sum of money available for financing.

HOLD

Hang on? He does not think they will go bankrupt. They sell oil in Europe and are getting a better price than in North America, where the debt levels are much higher. He owns it and still considers it a hold. He is glad the dividend was cut to help preserve cash for later.

BUY

Dividend safe? They halved the dividend and cut it further recently. It was a very long-standing dividend payer, but slashed capex because of their balance sheet. The current dividend is safe. He likes VET and has been adding to his position in the past week. VET has been shafted hard, unfairly. He likes the geographic diversity of their assets.

HOLD

It has a lot of assets outside of Canada. The price of oil has collapsed. They took quick action and kept their dividend where it was, then brought their dividend down in half and may have to again. He would not sell here. It will continue to be an oil producer for a long time.

RISKY

Payout ratio is still 103%. Balance sheet isn't horrible. Dividend yield is 27% post-cut. If you don't own energy, this is at least worth a trade, as long as you're not overexposed to oil stocks and the oil situation turns around. Risk/reward is a good bet.

DON'T BUY

It's impressive how far it's fallen. Seasonality is now, but the chart is moving the opposite way. Technicals were negative for a long time. It was hitting resistance so long then finally gave up. Now, the price of oil slammed today. All oil stocks will be vulnerable. But VET is now oversold with a parabolic move down. Parabolic moves are always unsustainable. Be careful if you nibble away here.

WATCH

Dividend cut? Royal Bank analysts think they may cut the dividend. This may be coming Friday, when they report earnings. He thinks there are lots of things management could do, like cut the dividend 50% or eliminate the DRIP program and the share price would jump up. He would not be selling it here, nor would he be a buyer.

PAST TOP PICK

(A Top Pick Apr 11/19, Down 57%) He no longer owns this one. It has always had a premium valuation as it priced its production off the Brent oil market. They switched out back last June, buying ARX-T instead.

DON'T BUY

It pays a huge 16% dividend which is a red flag. The company may insist it won't cut its dividend, but he's suspicious. (VET has never cut its dividend.)

PARTIAL BUY

The dividend yield is 15.55% which scares him. If the market knows a stock will cut the dividend, the stock can actually rally. VET is basing now and looking better on an absolute basis. If this breaks below November lows of $17.10 in a weekly close, then he'd worry. But the basing action now can support a partial buy.

BUY

He likes that VET doesn't produce in Canada and it hasn't fallen apart. It's still a good place to enter here.

HOLD

The poster child of the Canadian energy patch: high 12-14% yield which is an opportunity but also a threat. They could cut that dividend, but they never have, so he doubts they will. If the stock remains flat, at least you get that dividend. VET could buyback shares.

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Vermilion Energy Inc (VET.TO)