Latest Expert Opinions

Signal
Opinion
Expert
BUY WEAKNESS
BUY WEAKNESS
September 25, 2013

Bought this stock at around $5.05-$5.10 on a new CEO coming in who did a great job of turning the company around. Stock ran to $6.30 and he sold. He would re-establish a position at around $5.50 or so.

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Surge Energy Inc (SGY-T)
September 25, 2013

Bought this stock at around $5.05-$5.10 on a new CEO coming in who did a great job of turning the company around. Stock ran to $6.30 and he sold. He would re-establish a position at around $5.50 or so.

DON'T BUY
DON'T BUY
September 25, 2013

You have to be really, really careful with this stock. This company is locked into long-term contracts on offshore drilling rigs. Because of their cash situation and lack of exploration success in Indonesia, he feels they have about 6 months of life support left. Thinks they have to come to market and do a massive equity financing to clear up the overhang. Burning cash on a daily basis.

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Niko Resources (NKO-T)
September 25, 2013

You have to be really, really careful with this stock. This company is locked into long-term contracts on offshore drilling rigs. Because of their cash situation and lack of exploration success in Indonesia, he feels they have about 6 months of life support left. Thinks they have to come to market and do a massive equity financing to clear up the overhang. Burning cash on a daily basis.

DON'T BUY
DON'T BUY
September 25, 2013

Balance sheet is very strong. This is largely more of a gas producer. Because, to his knowledge, they didn’t protect themselves from this blow out and the fact that they don’t own their own infrastructure, they are a bit more subjected to the price of natural gas. There are some near-term headwinds for the shares. Well regarded and has great assets but wouldn’t be at the top of his list. (See Top Picks.)

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Bonavista Energy Corp (BNP-T)
September 25, 2013

Balance sheet is very strong. This is largely more of a gas producer. Because, to his knowledge, they didn’t protect themselves from this blow out and the fact that they don’t own their own infrastructure, they are a bit more subjected to the price of natural gas. There are some near-term headwinds for the shares. Well regarded and has great assets but wouldn’t be at the top of his list. (See Top Picks.)

BUY
BUY
September 25, 2013

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.

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Bonterra Energy Corp (BNE-T)
September 25, 2013

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.

COMMENT
COMMENT
September 25, 2013

Payout ratio is about 100%. Had an issue where they lost production in an area called Primate but at the same time they are having some success in another area through horizontal drilling. Thinks their guidance to the street is a little on the conservative side. Feels it is kind of stuck in a holding pattern with maybe 10%-20% upside. Exposed to heavy oil differentials.

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Twin Butte Energy (TBE-T)
September 25, 2013

Payout ratio is about 100%. Had an issue where they lost production in an area called Primate but at the same time they are having some success in another area through horizontal drilling. Thinks their guidance to the street is a little on the conservative side. Feels it is kind of stuck in a holding pattern with maybe 10%-20% upside. Exposed to heavy oil differentials.

DON'T BUY
DON'T BUY
September 25, 2013

Stock dropped when they converted to a dividend paying company where financial controls were probably not quite as strong as they should have been. Holding their annual meeting this Friday, so there should be an update on their production standpoint and their strategic reviews. There are 2 scenarios. 1.) It gets sold at $1.30-$1.35. 2.) Possible parachuting in of a new management team.

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Stock dropped when they converted to a dividend paying company where financial controls were probably not quite as strong as they should have been. Holding their annual meeting this Friday, so there should be an update on their production standpoint and their strategic reviews. There are 2 scenarios. 1.) It gets sold at $1.30-$1.35. 2.) Possible parachuting in of a new management team.

COMMENT
COMMENT
September 25, 2013

Faced some challenges this year. Recently cut CapX program pretty significantly. This was a high growth company so subsequently had high declines. Struggled on the drilling side where they over capitalized on one area. Production is falling and debt to cash flow has ballooned from almost 0 to 1.7-1.8 times. Feels they can maintain flat production by using all their cash flow. They require further success through water flooding. There is promise in the stock long-term.

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Pinecrest Energy (PRY-X)
September 25, 2013

Faced some challenges this year. Recently cut CapX program pretty significantly. This was a high growth company so subsequently had high declines. Struggled on the drilling side where they over capitalized on one area. Production is falling and debt to cash flow has ballooned from almost 0 to 1.7-1.8 times. Feels they can maintain flat production by using all their cash flow. They require further success through water flooding. There is promise in the stock long-term.