I do not own Tvk yet, mostly being hesitant that it would be tied to the oil and gas sector too much which is highly cyclical and I now mostly avoid resource stocks after being burned in the past. However Tvk has not fallen with the recent downturn in Canadian oil stocks. Still riding new highs daily here it seems. I guess my question is do you see a lag effect coming here in possible weakness coming for Tvk being that the oil sector is once again getting hit? Or is it diversified enough to completely avoid this? I am wondering if a better entry point might present itself down the road a quarter or 2? The
Thanks ,
Shane
TVK has some diversity, but Oil and Gas services accounted for $159M in revenue last year. Compressed gas equipment $211M. Not all of that would be for producers, though. This is on a total base revenue of $1B expected next year. So, there certainly is exposure. It is possible that producers see lower prices and cut back on spending. But, they have more or less been doing that for two years now, concentrating on paying dividends and buying back shares. And, TVK has not been negatively impacted in this environment, and has in fact thrived. The stock won't go straight up. A consolidation of recent gains is likely, at some point. But it is tightly held, and with market cap near $2B more investors are looking at it. For investors interested, we certainly would be comfortable with at least a 'starter' position.