Latest Expert Opinions

Signal
Opinion
Expert
BUY
BUY
April 3, 2018

This year will be a very big year for them. They do business in Morocco, which is a great place to do business this year. They sell energy in Morocco for much higher prices than Canada and the United States. They also had a discovery in Egypt and expect government approval to bring this onstream this year. The company has a clean balance sheet, is sitting on a lot of cash, trades under 2x cash flow. It is very, very cheap. His 12 month target is $2.

This year will be a very big year for them. They do business in Morocco, which is a great place to do business this year. They sell energy in Morocco for much higher prices than Canada and the United States. They also had a discovery in Egypt and expect government approval to bring this onstream this year. The company has a clean balance sheet, is sitting on a lot of cash, trades under 2x cash flow. It is very, very cheap. His 12 month target is $2.

Josef Schachter
President, Schachter Asset Management
Price
$1.040
Owned
Yes
BUY
BUY
April 3, 2018

Definitely would consider it. $25 target. Cheap valuation. If you own it, average down. Sustainable 6.6% yield. Now is a great entry point.

Definitely would consider it. $25 target. Cheap valuation. If you own it, average down. Sustainable 6.6% yield. Now is a great entry point.

Jaime Carrasco
Portfolio Manager, Canaccord Genuity
Price
$10.880
Owned
No
SPECULATIVE BUY
SPECULATIVE BUY
April 3, 2018

Calfrac is the high beta choice in this market space. Its problem is its balance sheet. They did well in the 4th quarter but they have a debt at the end of $984 million against a total equity of $477 million. That’s the balance sheet of a utility, not an energy service company. He expects a multi-year bull market in oil after Q2. If that happens, this company will generate a lot of free cash and will be able to pay down its debt. In the last bull market, 2014, this was a $21 stock, so if you are willing to take the gyration of $1 or $2 over the near term you might make a lot over the next few years. However, this requires more risk tolerance than he is willing to accept in his own investing. (Analysts’ price target is 8.65$)

Calfrac is the high beta choice in this market space. Its problem is its balance sheet. They did well in the 4th quarter but they have a debt at the end of $984 million against a total equity of $477 million. That’s the balance sheet of a utility, not an energy service company. He expects a multi-year bull market in oil after Q2. If that happens, this company will generate a lot of free cash and will be able to pay down its debt. In the last bull market, 2014, this was a $21 stock, so if you are willing to take the gyration of $1 or $2 over the near term you might make a lot over the next few years. However, this requires more risk tolerance than he is willing to accept in his own investing. (Analysts’ price target is 8.65$)

Josef Schachter
President, Schachter Asset Management
Price
$5.720
Owned
No
BUY WEAKNESS
BUY WEAKNESS
April 3, 2018

He likes this company. It is on his coverage list but not yet an Action Alert Buy. They have 92% natural gas. He expects it to increase output this year from 42,000 to 60,000 boe per day. They trade at 2x cash flow which he considers very cheap. Book value is $6.71 compared to a price of $2.12 on the day of the interview. Debt is $336 million compared to $1.1 billion of equity. He considers this an acceptable level of debt, but notes that other people on TV have said this level of debt is a problem. On the upside, this company has traded at 2x in the 2014 energy bull market. At today’s book value, the projected bull-market price would be $13 to $14. The stock is very cheap today, but it looked cheap in January 2018, when it was closer to $8. It could go down further before, perhaps to $1.80, it comes back. He has a $7 12-month target.

He likes this company. It is on his coverage list but not yet an Action Alert Buy. They have 92% natural gas. He expects it to increase output this year from 42,000 to 60,000 boe per day. They trade at 2x cash flow which he considers very cheap. Book value is $6.71 compared to a price of $2.12 on the day of the interview. Debt is $336 million compared to $1.1 billion of equity. He considers this an acceptable level of debt, but notes that other people on TV have said this level of debt is a problem. On the upside, this company has traded at 2x in the 2014 energy bull market. At today’s book value, the projected bull-market price would be $13 to $14. The stock is very cheap today, but it looked cheap in January 2018, when it was closer to $8. It could go down further before, perhaps to $1.80, it comes back. He has a $7 12-month target.

Josef Schachter
President, Schachter Asset Management
Price
$2.190
Owned
Yes
BUY WEAKNESS
BUY WEAKNESS
April 3, 2018

He likes the company. Book value is $10.77, he thinks the downside is $5. It traded around $14 to $15 in the last bull market for energy, so he sees the potential for a triple, but it is a stock that requires patience. There is potential for a 10 to 15% downside in the Q2 weakness.

He likes the company. Book value is $10.77, he thinks the downside is $5. It traded around $14 to $15 in the last bull market for energy, so he sees the potential for a triple, but it is a stock that requires patience. There is potential for a 10 to 15% downside in the Q2 weakness.

Josef Schachter
President, Schachter Asset Management
Price
$5.740
Owned
Unknown
PAST TOP PICK
PAST TOP PICK
April 3, 2018

(A Top Pick June 12, 2017. Down 33.70%). This has been a nasty market. The TSX energy index is down 10% year to date and the big international investors are hiding in the CNQ’s and the Suncors. The natural gas stocks have been devastated. Birchcliff is very cheap. It’s book value at the end of 2017 was $6.30. It trades today at $3.87. They are 79% natural gas, 21% liquids. In 2014, this stock traded at 2.2x book value, so it should trade at $13 to $14 in a bull market. His target for a year from now is $9. It also pays a 10 cent dividend, for about a 3% yield. The negativity around this stock is about takeaway capacity, which has been very tight, but capacity has been rising significantly, especially for liquids. As companies shift focus, their total production doesn’t increase but their proportion of liquids increases as the payoff and prospects for these has improved.

(A Top Pick June 12, 2017. Down 33.70%). This has been a nasty market. The TSX energy index is down 10% year to date and the big international investors are hiding in the CNQ’s and the Suncors. The natural gas stocks have been devastated. Birchcliff is very cheap. It’s book value at the end of 2017 was $6.30. It trades today at $3.87. They are 79% natural gas, 21% liquids. In 2014, this stock traded at 2.2x book value, so it should trade at $13 to $14 in a bull market. His target for a year from now is $9. It also pays a 10 cent dividend, for about a 3% yield. The negativity around this stock is about takeaway capacity, which has been very tight, but capacity has been rising significantly, especially for liquids. As companies shift focus, their total production doesn’t increase but their proportion of liquids increases as the payoff and prospects for these has improved.

Josef Schachter
President, Schachter Asset Management
Price
$3.950
Owned
Yes
BUY
BUY
April 3, 2018

Solid. Always liked it. $16 target. Hold on, but be ready to pull the trigger.

Encana Corp (ECA-T)
April 3, 2018

Solid. Always liked it. $16 target. Hold on, but be ready to pull the trigger.

Jaime Carrasco
Portfolio Manager, Canaccord Genuity
Price
$13.770
Owned
No