Altagas Ltd

ALA-T

Start selling it off gradually. ALA may go higher, but take profits a bit.

Good if you want yield, paying 5.2%. There's been a floor in place recently, and this sector does well in a low-interest rate environment--and rates will likely not rise. This is a decent play now.

(A Top Pick Oct 19/18, Down 6%) He is now out of it. There was doubt about their ability to sell assets and about their debt load. Longer term, their business is fine. They had to cut the dividend last year. He prefers the infrastructure space right now. This is still a fine company.

They have been on a roller coaster for the last few years. The dividend is still on ice for a while until they de-lever a bit more. He likes the name but is not in it now. He would buy on a significant pullback.

(A Top Pick Oct 31/18, Up 24%) He bought it for the dividend after a big pullback. He's holding on for that dividend. Energy will come alive at some point, and ALA will benefit. This is more of an electric generator (than oil), though tied to Alberta.

(A Top Pick Sep 26/18, Up 1%) It was up and back. It got completely misunderstood by the marketplace. They were forced by the market to cut the dividend because it was at 15% but they didn’t need to. They are investing in a utility at a great rate of return and you will see it start to seep into the company returns. You should see a dividend increase next year.

If you own this already, hold onto. The valuation is attractive to buy. They've pruned assets and paid down debt. Reasonably run. It's undervalued vs. its peers. In time, you will be rewarded for holding it.

(A Top Pick Oct 05/18, Down 3%) This was a theme of trying to catch a falling knife. He was surprised how it got wiped out and he got stopped out earlier. They spun out the Canadian utilities business, which was unexpected. This left the US acquisition in Washington. The market didn't like the debt level, when interest rates were going up.

It has had a stormy couple of years. It is now coming back. They are in the energy business where there have been no money flows for 4 years. There is a turnaround in place. It will be a slow and steady stock.

He was shocked when they announced they were combining with a utility in Washington DC. He thought the culture was too different. The stock seems to have made some good moves in sales and is now watching this stock.

Rate reset vs Rate reset with a floor. The stock is down because of the credit risk. Should look at the bond, and the prefs will perform. Altagas is trading weakly, even with a floor due to this.

ALA blew itself up, and is fixing its balance sheet. They have worked out some, but not all its problems. He predicts they will sell Altagas Canada as part of their re-structuring.

They have made a lot of positive progress on the balance sheet after the US acquisition. At this point they have done what it is required to stabilize the balance sheet. She does not own it.

His colleague upgraded ALA recently. It broke its long downtrend earlier this year and at that time he said don't buy until ALA breaks its downtrend. Now, it continues a new uptrend, and it pays a strong dividend. Cap your risk at recent lows; as long as it doesn't fall below around $19, ALA looks good. It's pushing higher in a new uptrend.

He would be careful with this one as the balance sheet appears stretched. Dividend growth is likely to be muted going forward. Money may come out of this one from investors.