Bonterra Energy Corp

(A Top Pick April 24/14. Down 36.76%.) Still a core holding. This company stands out as one of the best capital allocators in Calgary. They have a track record going back to 1998 of delivering exceptional returns to shareholders. A very disciplined company, and he considers it a cornerstone of his portfolio.

He is zero weighted in Canadian energy stocks. There are a number of cognitive mistakes people make about stocks that have gone down this much. Just because an energy stock has fallen to half it does not make it a bargain. There is a lot of oil in storage and demand is not growing as fast as in past economic recoveries.

To the best of his knowledge, this company does not have any oil hedges in place, nor reduced their dividend, but thinks it is imminent given that companies cannot grow production at $50 oil and pay a dividend. They have a good position in the eastern core of the Pembina field. At sub-$50 without any hedging, he thinks there will be a realignment of the dividend.

The pressures on this stock are simply industry related. Oil production growth is fine. They have a decent dividend yield. Good management and a good strong track record.

Stock has done well and he has no problem with this company.

Really good company. Came out with fantastic earnings. Great management. Have added lots of wells in the past 12 months. Great balance sheet. Also, likes the yield. Really good company, but he would prefer others.

(Market Call Minute) Steady eddy name that won’t make you rich from here. Trading at a premium to names he would recommend so if you own it just collect the dividend. Safe business model.

Preeminent dividend paying light oil stock in Western Canada. The best capital allocator in Western Canada. You can expect ongoing dividend increases and production per share growth.

(Market Call Minute.) Just bought some today. Could surprise to the upside on news later this month from results from some assets.

(Top Pick Nov 12/12, Up 7.97%) He sold on the day of the announcement of the sale.

Exceptionally well run company. Largely light oil of the Pembina/Cardium field. Had some recent success in drilling the longer horizontals. Implication of this on certain plays in Canada is transformational. You spend maybe 15%-20% more on a well which could increase production from 250 to 1000. Payback is much faster and, as a dividend payer, it gives that much more cash flow and free cash flow to increase growth rate are pay out a higher dividend. Wouldn’t be surprised if they increased their dividend in the next couple of months. Probably trading at 9.5X, so not the cheapest stock but the implementation of technology, if successful, could transform this company to be able to grow potentially in the mid-teens and still pay a pretty healthy dividend.

6.9% dividend is safe. The negative is that it is not one of the most traded former royalty trust names but decent balance sheet.

6.7% dividend. Was a leader in the Cardium play, there since the beginning. Tons of upside. It is reasonably valued. Might go up given balance sheet strength and acquisitions. A good core holding but he does not own it because he chose others. Dividend is secure. 10-15% growth potential.

Bonterra Energy (BNE-T) or Baytex Energy (BTE-T)? Really likes Baytex but it’s a little pricey, so based on valuation, he would choose Bonterra which is a little cheaper and has pretty good growth. Has a dividend growth model and looking at growing EPS at 5% annually.

Completed an acquisition of Spartan last quarter so results showed production was up. Because of what they are planning to do with this new mine you are probably going to find that production for Bonterra is going to decrease in the 2^nd half of this year. There is a little more gas than he had expected there would be. Yield is very secure. There are better choices out there.