This week’s new 52-week lows… (Dec 12-18)
There’s been quite a lot of stocks falling below their 52-week low which reflects the state of the market.
Here’s this week’s 52-week low stocks.
Would consider selling stock given strength. Doesn't think Entropy is a strong business model (baked into energy price). Stock is expensive without Entropy value. Better names in sector.
Debt concerns? BXE took bankruptcy protection when debt became too much. There is no equity value in it any longer. Companies that have debt that matures in 2020 or 2021 will have issues. He sees no issues with BIR or TVE on this topic. The new Federal relief program for large companies may be difficult…
It is a liquids rich player with very high liquids content. The problem is that the market cap is below the radar, and the debt is high. It was a $4 plus stock when we had decent gas prices. They are looking to bring their debt down. He thinks the company will survive. They've been…
HSE-T + CVE-T: Stay after the merger? He does not own either one. He understands the merger makes sense. There are a lot of cost savings that can be found. He prefers CNQ-T, PXT-T and one of his Top Picks today. He prefers these to HSE-T. If the sector bounces back you could get an…
Has gone sideways as it consolidates. Been challenged in western Canada because oil prices are down, but will rise in 2024. MTL still has great funda mentals.
You get growth. Dividend is 10.1%, yet has excess cashflow after that. He also sells calls on it. Doesn't see capital appreciation. Uses it as an attractive income vehicle.
Pengrowth (PGF-T) and Perpetual (PMT-T)? Had some challenges with their balance sheet over the last couple of years with the collapse in oil prices. This one would be a little riskier. If you really see a big jump in commodity prices, this probably has a lot more upside than Pengrowth (PGF-T).
Has been an unfortunate story. Was a leading player in shale gas in Quebec a number of years. The government came out against it. Has some western Canadian production that has cash flow. Balance sheet is relatively clean. Started talking about carbon capture and storage. There is some insider buying recently.
(A Top Pick Oct 26/23, Down 11.1%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with VET has triggered its stop at $18. To remain disciplined, we recommend covering the position at this time. This will result in a net investment loss of 5%, when combined with our previous recommendations.
The company is very cheap in terms of price to book. Their book value was $4 at the end of June. However, they have a debt problem: $211 million of debt compared to an equity value of $369 million. He sees this as a takeover candidate especially now because he is seeing consolidation in the…
(A Top Pick Aug 13/18, Down 61%) They disenfranchised the Canadian shareholders. He sold out sooner before the de listing, so did not do as badly, nor did his subscribers. He disagrees with their move.
A behemoth in the Montney region. Good cost control, highly regarded management. Close second to TOU, always one of his Top Picks. Pretty good performance relative to peers. Be patient. $25 would not be difficult, especially as LNG builds out in Canada and prices firm up globally.
(A Top Pick Jan 27/23, Up 48%) Roughly 40 years of inventory. Successful at using free cashflow to pay down debt. Paying more to shareholders. 17% free cashflow next year, trades at 3.5x cashflow. WCS differential should shrink next year. Still very good upside.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research EPS of $0.08 missed expectations of $0.086 and revenues of $91.1M beat estimates of $83.64M. This is the second consecutive quarter of disappointing results, and while it trades at a reasonable valuation of 13.3X forward earnings, its high and growing debt levels are a concern.…
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research Negative momentum would be the main issue holding us back right now. It is down 18% in November alone, and with the 3Q 'miss' and the big negative shift in the energy sector, it is hard to step in aggressively without at least some stabilization.…
For Baytex there is some consolidation here due to some nervousness re the price of oil. Cenovus is similar to Baytex and has dropped to the consolidation level. It could go to the $20 level in the next 3 to 6 months. Don't buy energy now since it could retrace much of its big gains.
Oilfield services firm that has big fracturing technology presence. Horizontal drilling and shale boom not as strong. Very dependent on energy prices. Lots of assets that must be carried on the books. Not investing at this time.
Spending more money on a project, free cashflow won't be for 2 years, and market's attention span is very short. Concern they'll be burning cash to pay the dividend. Balance sheet indicates sustainable dividend, unless oil price really nosedives. Insider buying. Too small for him. Yield is 10.5%.
They have cut back and preserved capital. They do not have a debt issue. They are a gas play. If gas prices stay strong, they should do well. She anticipates their 4th quarter production being lower. She is not buying it today, but the future looks good.
They did a flow through share. The company is involved in oil and Nat. gas. He has a $1.20 target on it. If they can generate more cash flow they can get the debt down. He likes it. He may add on weakness.
Nat gas prices have been slaughtered, which impacts this one. Likes that it managed to cut production. Bit of an overhang in nat gas, so there's an overhang on valuations. He focuses on the larger integrated players like CNQ.
Just beat earnings and have increased production. Cheap valuation compared to peers. But it's getting more expensive heading into 2021. There's no growth here, but that goes with the entire oil patch. The real issue is will they survive. Their balance sheet is getting better, but still high for a blue-chip name. You'll be saved…
He stayed away because they went to the states to make acquisitions. He did not know why the Americans would not already take these assets. He stays away from it.
At least 15 years of drilling inventory in Bakken play. Very strong balance sheet (almost no debt). Expecting ~60% of free cash flow returning to shareholders. Trading under 3x cash flow with $80 oil. Expecting ~$29 share price next year given $80 oil. Expecting strong performance in 2024. Value proposition very strong.
One of the largest fleets of generation 3 and 4 deeper coil tubing. Two businesses: coil tubing and tools. Both are being run efficiently. Margin pressure in the sector. Great little story that will be a big beneficiary of LNG drilling. No debt. 5-year bull market target of $3. 2023 will be a pivotal year…
NexGen vs. Fission He owns both Fission and NexGen. They're far from infrastructure in the Athabasca Basin and would be challenged if it wasn't for their deposits being large and of quality (and next to each other). They could get built as a pair. The Fission deposit is borderline-tier one deposit, whole Nexgen's is. The…
Lower beta way to get exposure to oil and nat gas. Conservative. Attempting M&A in US, but balance sheets are so strong, fewer companies need royalty deals to raise cash. Strong organic growth prospects next year. Yield is 7.5%, payout ratio at low 60% range. Trades at 8.5x, compared to the unjustified 14x for PSK.
Seeking strategic alternatives for the second time, aka "looking for a buyer". Dividend is not sustainable. Trading at 2.2x, so a premium on a sale is possible. If no sale, dividend will resize.
Have been increasing production aggressively. They just acquired a company to add to their production. This acquisition should help them move from small cap to mid cap. It has had a nice move up from there. Looks attractive. Waiting for a pull-back.
It is quite a small company. It is hugely volatile. There a lot of problems over the years with the pricing of data coming from India regarding a 10% stake in another company. They have too much debt. The price of the gas they sell has been negotiated. A tough name to predict.
Not a good investment with current management team. Other energy companies available with better opportunities.
At an extremely attractive level. Focused on maximizing free cashflow and de-leveraging. Anticipates it meeting an inflection point of moving from using money to de-lever to using it to reward shareholders, by Q2 of next year.A non-depleting business, low-maintenance assets. Backdrop of LNG Canada, replenishing inventory, good macro headwinds. His numbers show 34% free cashflow…
Does not believe dividend us sustainable given current strip price.Could take on debt to sustain dividend.Challenges ahead for the company.Depends on outlook for natural gas.
Has nat gas exposure--and he's bearish on all nat gas stocks. Market cap is way too low for investors to really care for in this sector.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. STEP is down 35% this year, but up 59% in 52-weeks. Profit taking is probably part of the issue here. It did beat estimates in the 4Q, but the sector has been quite weak, and the company has recently seen two downgrades by brokers. EPS is supposed…
Likes it a lot, its upstream, midstream and downstream operations. They enjoy very long-life reserves in the Oil Sands. The dividend is quite good and it well managed. Seasonal strength happens in December-January, so buy on weakness, and hold long term.
(A Top Pick Apr 26/23, Up 48%) Outlook quite strong in terms of well servicing, you can go back in and re-frack to improve productivity. Nice, strong upward bias to fracking services and intensity of services. Nice yield.
Offers growth and share buybacks. Reported great Q3 earnings. Expects long-term growth in natural gas, because it will allow the transition from fossil fuels to renewable energy. The transition won't be sudden. (Analysts’ price target is $84.83)
There are aspects that will detract institutional ownership. There are some promotional aspects. The name is cheap and are paying down debt. It is not a name he is looking at. The quantitative and qualitative aspects need to match and for him it does not meet his requirements.
🛢 Basic Materials
It's been stuck at these levels for a long time, but likes recent volumes. No problem buying this one.
Forestry space He owns no names. The stocks are okay but face trade disputes and an economic slowdown that will hit housing stocks. The stocks have been beaten up.
The market doesn't believe their balance sheet; shares keep falling. He forecasts 60% downside. Massive losses for the company.
Has an old mine outside of Los Angeles that was run in the 1930s. Closed down during the Second World War and they are doing open pit mining in the area. Has some issues, but at these gold prices, it will probably start to work again. Under followed. Highly speculative.
The company has suspended its dividend. They operate diamond mines in South Africa. They are looking into underground, from open pit. The cost is more expensive than thought. The price of diamonds has been reduced, though retail prices won’t change.
Agnico-Eagle (AEM-T) came in a while ago and made a 9.9% stake in this company. The stock went up, but it really hasn’t done much since then. Then Barrick (ABX-T) came in and said they really liked the deposit and wanted to do a joint venture. This is a much better approach that is better…
Likes the managers, but concerned with the topography. A decent-sized gold project. A good speculation.
Ranked as a 4 in his system, which is high praise. Holds management team in high regard. Wonderful asset allocators and patient investors. Recently entered into royalties for renewable energy.
Wallbridge Mining to buy Balmoral It depends on your timeframe--some will take the premium in Balmoral and grab the profit. He expects in two years that the deal will benefit shareholders with lower costs. The Abitibi is a great gold district. If he owned this, he'd hang onto it.
Just completed an expansion. A bit more debt leveraged. Fortunes rise and fall with copper, especially with a recession scenario. China's problems aren't helping. Should be back to $3 in next 3-6 months, $4 in a year. Operational issues in Q1. Second half should improve. Sit tight. You could dip your toe in Q4.
Attracted to it, but doesn't own or recommend. He rates it a 5, which is neutral. Gold and copper in Mongolia. Data doesn't justify labeling findings as "massive" discoveries.
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The sector and in particular the company has shown good momentum. Good cash flow off-sets their stretched balance sheet. Cheap on valuation. Unlock Premium - Try 5i Free
Demand for lumber will continue to increase.Short term weakness in housing (recession) not a concern for long term investors.Expecting performance for long term investors.
“Jumps and Steps” – quite common in junior companies. Each jump is a news item. As it gets closer to production, it will keep on doing this. Pullbacks are due to profit taking. Must stay above the $0.30 level, otherwise it may be bad news.
Always highly leveraged on risk/reward. Geopolitical risk of Cuba. Nothing compelling in terms of nickel or cobalt options, there are better choices. No dividend.
This is on his watch list. He is not familiar with their fundamentals. Today's earnings release will help define their future.
AX.UN vs. HR.UN In the midst of trying to decide on its strategy. Strategic review. Outcome uncertain. Challenging market in which to sell non-trophy real estate. Show-me on execution. Higher risk.He'd own HR.UN over this one.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. BDT is a $450.6M company with a strong dividend yield of 5.1%, and has been paying down debts recently. Sales growth has been decent, its profit margins are somewhat thin, but it has a nice cash balance of $115.8M, and generates decent cash flows. Its…
Stockchase Research Editor: Michael O'Reilly Always a solid quality company, it is trading at 1.1x book and 11x earnings with net margins of 22%. We like that cash reserves are growing, while debt is aggressively retired. We recommend placing a stop-loss at $94, looking to achieve $126 -- upside potential of 15% and a good…
(A Top Pick Jun 13/23, Down 10.2%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with CIX has triggered its stop at $13.50. To remain disciplined, we recommend covering the position at this time. This will result in a net investment loss of 12%, when combined with our previous recommendations.
It has really transformed over the last ten years. It is attractively valued but it will be aggressive in spending that excess capital. You may not see that value-unlocking potential. He would look for more of a stable cash flow. He is not sure how the mine developments will pan work out.
They own U.S. hotels, a high-risk, high-reward stock. He's bearish on hotels, which is struggling with labour costs and keeping labour. HOT.UN has done a good job restoring vacancies, in the low-70s, though their peak was in the 80s. However, they've made up the balance on their hotel rates. Their balance sheet is slightly higher,…
(A Top Pick Nov 13/20, Up 33%) Has started buying back shares and paying dividends. Financials should do well as the yield curve steepens. Valuation is not as compelling as before. Middle of the pack. Has moved to US banks and non-financial banks in Canada.
(A Top Pick Dec 04/19, Up 13%) He'd buy it again. Nice value stock. Nice yield. Trading at discount to book. Would benefit from rising interest rates, which he expects. Cheaper than all the banks.
Disappointing. In Canada, US, and Ireland. Grew with too much leverage and got caught offside. Cut distribution twice. Cashflows under pressure. Small size, high debt profile. Avoid.
Blockchain miner. Blockchain is like the internet in 1995-96. Once it gets going, you can't stop it. Technology moving forward is diversifying. Investors can participate in the building of the network. $20 target. No dividend. (Analysts’ price target is $22.99)
(A Top Pick Feb 24/16. Down 43.33%.) This was a big disappointment. They changed their focus on their business plan. He got stopped out. They were basically doing loans to doctors, but have now changed and is doing software service. The market didn’t like that.
Invests about 80% in industrial warehouse REITs, with the balance in office and retail. Elevated cost of capital, so it's in secondary markets. Above average leverage, resulting in a higher distribution yield. Limited growth because of cost of capital disadvantage. A yield play, not a growth play, and growth is what you want in this…
Possible takeout candidate. Cheap share price value. Paying stable dividend. Not highest quality name in sector. Would recommend partial investment.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Record quarters during COVID. Entry into debt valuation interesting. Greater SaaS revenues support better margins. Premium valuation means less room for error. Unlock Premium - Try 5i Free
All banks are down 25-30%. CIBC is most exposed to housing mortgages. Banks pay a high yield, 7.1% by CIBC, which is huge for banks. Worries are a recession or housing weakness. But the Canadian banks enjoy an oligopoly. Canadian banks are okay short-term as they enter seasonality now.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research In Q3, DRM missed analysts’ EPS estimates of $0.19, coming in at $0.09. Revenue was up significantly in Q3 at $132.5M from $55.1M in the year prior driven by increases in recurring revenue. Adjusted funds from operations showed a large Q3 increase to $0.42 per…
It is not trading at a premium to its book value. It is doing well on the insurance side. Its investment side is pure value stocks so it is not doing as well as Berkshire. There is growth potential.
Stockchase Research Editor: Michael O'Reilly IGM is one of Canada's largest diversified wealth management companies with over $250 billion under management. It trades at 9x earnings, 1.3x book and operates with 35% margins. It pays a good dividend, backed by a payout ratio under 50% of cash flow. Quarterly cash reserves are growing, while debt…
Smaller cap company. The financial technology was originally launched as a lender. Now it is in bitcoin and wallets. Still no earnings. Challenge is that it trades 28x EBITDA, no return of equity, no cashflow. Has had good price momentum in the past but too volatile.
(A Top Pick Feb 16/16. Up 6.28%.) This has some creative stuff and he had been looking for bond portfolios that are actively managed and a little bit outside the normal ETF’s. He is still buying some of this.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research The US bank sector of course has had a tough year, and the outlook will largely depend on the economy and rates. However, the fund now has an average P/E of 5.5X and an indicated yield of 3.49%. We think this is cheap enough that…
HPB Energy Bull+ ETF. Immediate leverage to oil price moves. If you have a very good near-term bet that you want to make on oil this would be the way to go but if you are looking for an investment in the oil patch that has a long-term investment implications, then you should go to…
In his income portfolio. He's cautious on Canadian energy, as the politics are not agreeable to energy right now, but he still wants to participate. Biggest 20 energy companies in the world. Good way to play in a diversified way with one holding.
HBP S&P 500 Bull (HSU-T) or BMO Equal Weight US Banks Hedged To CDN$ (ZUB-T)? These are 2 completely different things. A lot of people are negative on Bull+ and Bear+ ETFs but he thinks there is a place for these things but he doesn’t think it is here. Thinks it is going to be…
This is a call on oil. He is not going to want to buy a lot of oil. This is the 15 largest companies and they write covered calls. You will collect much higher premiums for the calls. But he would be cautious of this one.
If you're looking at a global ETF, remember that 60% of it's going to be US. For an Asian ETF, 52% is going to be Japan. People want diversification. To get decent global exposure, you're going to need to pick up a couple of ETFs, as just one can't do it all. One is XIN,…
(A Top Pick August 8/17, Up 8%) This holds what’s left over from the XIU 60. Wanted to get into some smaller stuff to get better diversification, and focus on this rather than the broader-based indices.
It's the US small caps index. They do better in times of declining yields and higher growth. This is good if you want to hunker down and hedge the US dollar. Small caps are beat up, but he predicts a rotation in the coming year to favour small caps. XSU is decent, but he prefers…
He would recommend taking a tax loss on this and buying into his energy fund. His fund has fewer names and a larger average market cap. The ETF is passive -- he prefers active management.
If a long term investor, a good buy. Not a good product for day traders. Don't worry about liquidity. Always a buyer for product.
Alcanna (CLIQ-T) TSE
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. No longer backed by Aurora. Multiple attempts to redesign stores. Multiple products sold at steep discounts. Deteriorating margins.
(A Top Pick Feb 01/23, Up 27%) They plan to expand from 1,500 to 2,000 locations. Have a joint venture in Latin America. Are taking market share from other retailers as consumers tighten their belts. A fantastic compounder. He remains long and strong on this.
BRP INC (DOO-T) TSE
Trades at 8x PE vs. peers at 12x. They mostly beat their last quarter, generate free cash, take more market share and enjoy robust demand for snowmobiles. A caveat is that in a downturn, discretionary costs like this will be cut. (Analysts’ price target is $138.93)
Strong business, but share price has fallen latley. Would wait to buy once trend reversal occurs. Fundamentally, company scores 10/10. Excellent brand value. Expecting 40% upside. Dividend yield is safe. Would recommend buying on weakness.
It is unbelievable where this stock is trading at. Acquisitions this year are worth less than half what they paid for them. It was trading at less than half what it was worth. They are trading below the amount of cash they have. It shocks him how far it continues to go down.
The price has dropped substantially because of slowed growth and problems like supply chain issues. However there should be more retail distribution opportunities for the wine industry. Also there may be financial programs that will help as well. Margins should improve and he feels there are better days ahead.Editor's Note: The caller was also asking…
(A Top Pick Jun 18/18, Up 1%) Still likes it. It's well-run. They're growing their brands and they have a big opportunity to get into cannabis beverages which will be legal in Canada in October 2019. BRB is well-positioned for this and this market could be very large.
Covid hammered them, while a British company tried to buy them but aborted that deal (now in a lawsuit). It's not cheap seeing a movie, but he goes now and then. Movies are coming back, though. You can't duplicate the experience at home. Still a lot of uncertainty with this stock, though.
It's never done anything and has disappointed shareholders. He owned shares 10 years and sold it because he got fed up with its lack of progress.
Is fairly illiquid, but profitable and pays a 6.6% dividend. Price targets are high, so there's a runway ahead. But two-thirds of the business is concentrated in Canada, and a big risk is if song royalties rise. It's profitable though. He's watching it.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research The company is seeing positive growth in the tolling and enforcement business, and it has a revenue backlog exceeding $500M. Its market cap is around $228M, and its price has begun to turnaround since the summer, where it announced a credit relief program for its…
Provides a service very similar to Alphabet (GOOGL-Q), which is provided for free. When your competitor is providing your services free, it is tough to be competitive.
(A Top Pick May 16/23, Up 110.3%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with CLS has triggered its stop at $32. To remain disciplined, we recommend covering the position at this time. This will result in a net investment gain of 70%, when combined with our previous recommendations.
(A Top Pick Oct 07/20, Down 7%) Not long after making the recommendation the stock benefited from a lot of ETF buying. They exited on the strong buying on a much higher gain. Since then, the ETF buying has evaporated and the stock price has come back down.
Just announced a discovery in Columbia. Flow tested over 2000 barrels per day. This well could produce up to 5000 when brought into production. A very well distributed stock so it might not jump too fast. Company could get taken out.
Challenge was that to get this business where it is, they had to do a lot of acquisitions and take on a lot of debt. Tough environment for companies with debt, stock's under pressure. Follows it. Great business, good growth. Don't buy here.
(A Top Pick Dec 20/18, Down 40%) It had a good turn in January. Beaten down stocks can have a nice bounce in January.
He's looking at the space, which is attractive. Off the highs. Business is materially tougher, but we need it. Regulatory issues and scrutiny on EXE. Labour situation also difficult. Likes the price, but wants to see more on the business fundamentals.
They hit a financing crisis and needed cash. So, they issued 20 billion share at 1.5 cents per share. A massive dilution that destroyed the shareholder base. Avoid.
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research We can't make short term predictions with any degree of accuracy, but EIF rose 8% with the November rally (plus a 21c dividend). It also just raised its dividend 4.8%. Much of course will depend here, and it will follow the market, but it is…
50% of revenues are in western Canada, plus Chile and the UK. Higher commodity prices offer this some momentum and pushed FTT to new highs this year. But this is a cyclical name, so careful. Yesterday, CAT shares fell on shrinking demand, so that's a canary in the coalmine for FTT. Profits are decent and…
It is in a downtrend with a series of lower highs and lower lows. It needs to stop this trend and move sideways. You should look at highs and lows on a weekly chart.
It formed a nice base. It has a strong yield. It is coming out the last few days. We are getting close to a break out.
He bought it as a value play with sum of the parts worth more than it was trading at. They are trying to sell some of the parts. Thinks they will sell all the parts and distribute the cash. $4-$5 breakup value. It is taking longer than he thought to break it up.
Use this list wisely to identify buying opportunities.
Happy trading !!!