Whitecap Resources (WCP.TO)

Consider taking a little bit of profit. Doing extremely well. Volumes were ahead in latest quarter. Purchase of VRN really added to its scope.

At current prices, don't rush to jump in. He'd be more comfortable buying around $11-12. Not one to own just for the yield.

One of his largest positions. Lagged, up "only" 27% this year. In prime position to get re-rated. By buying VRN, increased market cap. Now has size and scale. 25+ years of tier 1 (ultra-economic) drilling inventory. CEO is one of the few who actively buys shares on the open market. Continues to drill some of the best wells in the Basin.

A projected 7x multiple at $80 oil would give you a $25 share price, 69% upside. Yield is 4.95%.

Great long term. Growth story to buy on dips. From a cyclical perspective, after the current rally, he'd be a seller at this point. Take a look at the 5-year chart.

It also depends whether you hold it in a taxable account or not. He's pretty sure we're going to go through a time when it's like 2022-2024 -- stock will go sideways and potentially lose you money.

If you're a trader in a registered account, sell sell sell sell. If you're a long-term buy-and-holder, trim a bit or buy some put protection. Don't throw new $$ at it. We're headed back to $60 oil.

Core holding in his income fund because of the dividend.

Kicking himself, as he sold when it reached shorter-term targets. Likes what it's doing. Most importantly, it stole VRN -- now seeing benefit. Good management. Valuation not excessive. 

Might get in again at some point. Yield is 5% and change.

Another name with a good yield for the income investor. Largest weight in his fund at almost 12%. 

Quality of management team and quality of assets are still misunderstood. At 5.1x, trades at material discount to peers. Beat expectations 8 or 9 quarters in a row. Healthy dividend of 6.2% is sustainable down to $50-51 oil. Ongoing, extraordinarily good well results in Montney, Duvernay, and elsewhere. Expects multiple expansion over time.

$60 oil would mean share price of $19, $70 oil means a price of $23.

Owns a bit in his dividend income fund. Great yield of ~7%, which he thinks is sustainable at current prices. If WTI oil moved down to $40-45 for any prolonged period, dividend might be cut. Great management, well run and well diversified. Some heavy crude (of concern with Venezuela), but a lot is lighter oil and natural gas, with some condensate.

He wouldn't have any problem buying it today, and look to add it if falls below $10. He tends to buy it below $10 and trim between $11-12 (though merger with VRN last year is new source of upside with the larger inventory base).

Good quality assets, has grown production. Management's done a great job. Cares about shareholder value -- buys back shares, increases dividend. Trouble is that oil and gas have been very difficult environments over the last while. 

He owns CNQ and SU -- stabilizes you a bit when you're worried about the price of oil. Don't get the upside of the smaller players, but don't get as much downside either.

Doesn't own, but he can see the case for it. Especially with the assets it's been able to consolidate, now much more stable and powerful than a few years ago. He'd prefer other names ahead of it -- CNQ, ARX (likes the condensate over light oil). He wants the best operators and the most stable long-term outlook.

ENB is a great long-term hold. Has come off again recently. In his portfolios, weighting of pipeline/infrastructure/renewables/utilities over producers is 3:1. Dividend yield over 5%.

He'd own some of both. Diversification is always good. For a young investor, you want to help them learn. (Ryan always tells the hockey team he coaches that "You learn more from losing than from winning." ;) This pairing can show them how different stocks move at different times. When the market's doing really well and oil prices are running, you'll see that reflected in WCP. When they're not, you'll see the stability of ENB.

Doesn't own, but likes it and respects management. Probably a great addition to a TFSA. Nice dividend. Diversified. Continues to reduce leverage, returning capital to shareholders via dividends. Stock's responded, even with weaker commodity prices. Has owned in past, has his eye on it.

With excellent VRN merger, market cap is now suddenly relevant to large institutions. Bullish on oil for second half of next year, but range-bound till then. This makes it important to choose oil names that will re-rate for a variety of reasons without needing oil price to go up. 

At discount to peers. At least 25 years of stay-flat inventory. Significant increase investor attention from US. Decline in US shale requires them to go to less mature areas such as the Montney and Duvernay (both of where WCP has exposure). Trades at only 5% forward cashflow at $60 oil. He believes fair multiple is 7x, which translates to $19 a share. 

If you dare to dream of not-impossible $70 oil, that's a $23 share price. Yield is 6.28%.

One of 3 oil names he owns, given his somewhat cautious view on oil. One of the lowest multiples of the Canadian mid-cap producers. Purchase of VRN improves asset quality. At least 25 years of really high quality stay-flat inventory, so they don't have to burden themselves with M&A. 

Yield is sustainable down to ~$50-51 oil. Trades at 4.8x cashflow, while peers are closer to 6x. Sees roughly 42% upside. In 2026, focus will pivot to the twilight of US shale, demand growing for next several decades, and OPEC running out of spare capacity. 

Low risk, low debt, strong balance sheet, high asset duration, very shareholder friendly. High insider ownership. Inventory keeps getting better over time. Yield is 6.64%.

Ten most actively managed funds are underweight energy in general. Any exposure is ~6% vs. 18% for the TSX, and they only buy the big 3-4 names. Companies that are in the tier just below that, such as WCP, tend to trade at a discount. That should change as more generalists come back to the gas patch. Quality name, undervalued.

He owns it for the dividend. Good cash flow. Fine operator. The Veren acquisition has given them more room to produce. Even at current oil prices, they are turning a profit. Is holding it for the dividend, but doesn't see a catalyst to move this higher.