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TOP PICK
Always had too much debt, heavy oil, etc. and now they are going into the Clearwater play. They acquired a massive position and drilled the 2 best wells and got cashflow back in a month. Trading at material discount and changing rapidly. Committed to being a strong returner of capital. (Analysts’ price target is $4.83)
oil
gas
PAST TOP PICK
PAST TOP PICK
(A Top Pick Nov 20/21, Up 217%) You get leverage to a rising oil price since it is unhedged. Has differential exposure to WCS differentials. At $80 oil, they will reach their next hurdle for cashflow. Upwards of 20% of shares being retired every year. Could privatize themselves in a couple years with cashflow. Target of a 6x multiple.
oil
gas
COMMENT
Has been a rollercoaster for energy investors. Fundamentally, nothing has changed. SPR release weighed down, and now there are fears for Omicron. The collapse in oil price is discounting 7M barrel per day collapse. This is equivalent for all planes on the planet not flying for months. The average Canadian oil company could privatize themselves with 5 years of cashflow. Would continue to be aggressive in oil.
BUY
Everyone wants higher prices. The easiest way to drive re-rating in stock price is to meaningfully buy back stock. Wants to get debt free and then return capital after. They should be debt free by mid-next year and then they should return the majority of cashflow to investors. 13% free cashflow yield.
oil
gas
BUY
They had finance fears for their notes that were due. Now they have good leverage to rising prices. You are buying for the oil sands assets. Now, they also have huge tax losses that can be useful. Selling at 1x free cashflow if you give value to the tax losses. There is still good upside and is still a meaningful shareholder.
oil
gas
