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(A Top Pick Sept 15/16. Down 8%.) *Short* (Pairs trade with a Long on TA-T.) He still has both positions on.

Has been Short this for a long time, but recently covered his positions by buying Calls. They have a ton of debt, and for the last several quarters, have been hitting negative free cash flow of about $1 billion or more, while also paying a dividend.

One of many natural gas producers that’s been beaten up really badly. High quality assets, with an opportunity to de-lever based on many things. Gas assets in the Deep Basin are quite solid. Produces quite a bit of propane, not a bad gas liquid to be producing at the moment. It appears there is too much debt on the company, so he walked away some time ago.

His only natural gas exposure in Western Canada is Tourmaline (TOU-T). You would have to be really constructive on Canadian natural gas pricing (AECO) to really want to own this. A very high-quality company with good assets, good management and a reasonable balance sheet. Pays a dividend yield of north of 8%, which is probably telling you something.

Has exposure to pipe fabrication. So long as horizontal drilling is going to continue apace throughout North America, they should have good exposure. He likes management.

The street seems to have gotten more constructive on this. He would worry about the $10 billion debt, which is debt to EBITDA of 9X. A very capital intensive business, which is very troublesome. They seem to have been given a breather by the Airbus deal they did a couple of weeks ago. If they can survive the onslaught that is happening in their train division, things will be fine, but at this price he would not be a buyer.

Uranium market is structurally challenged. The problem at Fukushima changed the story for uranium. Uranium bounced after Cameco (CCO-T) decided to shut down one of their mines. However, they can bring it back on whenever they like.

Starting to look quite cheap. The cash flow profile going forward, from 2019 onward, should look fantastic. Just made a large acquisition, which came with a refinery in British Columbia. That will require a lot of capital in a turnaround early next year. The free cash flow profile doesn’t look particularly good for 2018, but beyond that it should look quite good. Refining margins in BC are at record spreads. They should be making a lot of money at the moment. A decent, steady business. Not a bad name to own. Dividend yield of 4.6%.

A big provider of group benefits, focused on small and medium-sized businesses. A good free cash flow business. Earnings will never particularly look good on gap accounting, but the cash generation is very real. The niche they have carved out for themselves is quite good. The macro space is very positive. Very capable management.

Has an ROE slightly below 14%, which is why it would trade at a lower Price to Book multiple of 1.6X. The bank has bought its way into very competitive markets, mainly in the US and things like commercial banking. It would not be the bank he would buy, but doesn’t see any particular risk in owning it. Doesn’t feel you are going to get a lot of performance above the group.

The stock had gotten a bit too expensive, and is still reasonably expensive at north of 20X earnings, but at the same time it is a very dependable business model, as most people would want to try a mattress before they bought it. A brick and mortar business that should live on. There is nothing not to like about this, other than the valuation.

He likes this and their light oil assets. Trading at a very reasonable cash flow multiple. The balance sheet is good and he likes management. Feels the reserves are under represented, so he sees very positive reserve growth. Has good production per share growth. This is an oil company that actually generates free cash flow.

Operates processing and transmission facilities, largely for natural gas producers. Natural gas liquids and propane are trading at reasonably good prices in Western Canada. He sees this trading at a pretty steep multiple discount to their much larger peers. Really likes management and feels they will be able to execute on their growth plans. Dividend yield of 2.7%. (Analysts’ price target is $2.08.)

A Colombia oil play. Generates free cash flow. Has no debt and has cash on the balance sheet. He really likes management and the assets. Expects to see another 20%-25% jump in their reserves. Trading at 5X cash flow. (Analysts’ price target is $22.00.)

Just closed the Richmont acquisition. Views it as a premier mid-cap name in Canada. There is no debt and they have a bunch of cash on the balance sheet. Generates free cash flow. He calculates their all-in sustaining costs is a little below $850 an ounce. Operates in Canada and Mexico. Likes management and the assets. It’s not unreasonable to have some gold exposure, in case things go sideways. Dividend yield of 3%. (Analysts’ price target is $12.00.)