Investment Q&A

Q: Hi Guys,

This maybe a naive question but I'm curious about falling prices of oil stocks. If a companies stock price goes to Zero does that mean the company is bankrupt and will go out of business? How important is a company's stock price to it's operation. We know that a stock's price doesn't always reflect a company's NAV but many oil company's stock prices are so low what's stopping a large company like Suncor from buying all the stock of cheap companies, other than that they are lousy businesses.

Thanks,
Charlie

Q: Having read their financials, I am trying to understand to what extent they have hedged their revenues. If I am reading this correctly, I not seeing many call options on oil beyond the first two quarters. Any concerns over their ability to weather the storm, debt wise? Long term debt isn't due for a few years. Covenants could be problematic? Cuz the stock looks very cheap.

Cheers Leo

Q: I own some CU. Knowing this, would ACO.X being more diversified, be good value at this price to hold as well as CU? Any thoughts on ACO management? They seem to have held up well in past "strained" markets and the dividend is nearing 5%. Good for a dividend investor?

Q: HFR has traded around $10 for the longest time. Why did it suddenly dropped 10% today. Will it recover? Thanks

Q: I own shares in Husky Energy. Today price dropped to $2 per share and Saudi Arabia will be increasing oil production. I expect the price will continue to drop for awhile. At what price would the stock be delisted from the TSX? If it is delisted at some point and the company continues to operate (without going bankrupt), are the shareholders entitled to anything? Thank you for your assistance with this.

Q: With the recent sell off, what are your thoughts of adding EBN.CA to my portfolio?

Q: I have a very small position in the above 3 utility companies and want to add more. Can you please rank the companies for estimated best total return over the next 3 years?
Thank you.

Q: I was wondering if it would be possible to get a list of the CDN O & G companies that would be at risk of cutting dividends. Most have high debt levels and if O & G stays low for a long time, they will have to conserve capital and pay back debt.

Q: With WCS below $20, can these oil sands producers still make money?

Q: I know you have been favorable on this company recently, can you comment on this new acquisition and the sustainability of the dividend.
Thanks for all your advice

Q: Dear 5i,
Is ENB hybrid i.e. 50% Energy / 50% Utilities? This is for allocation purposes in RRSP account. I am underweight in Utilities. but at 4% in Energy, mainly with ENB. Should I add more to ENB considering current price and environment or look at BEP.UN? Thanks in advance for your comments

Q: Currently hold both (1.5% position) and down a lot despite having good management teams. Thinking of selling for a tax loss as I have some gains taken earlier this year pushed forward from last year. Outlook for both in this depressed market with prospect of $20 oil and whether they can weather their debt levels. Buy, hold or sell?

Q: Given the large drop in IPL stock price, what is your sense on the safety of the dividend given the thesis some of their customers might go bankrupt or reduce output. Are their customers at risk and if so which ones.

Q: I always thought of Suncor as one of the most stable energy players. It also had a low dividend. With the latest drop the dividend is now at 9%. How risky would this stock be to buy?

Q: I know there is crazy volatility right now, but am I missing something one this one. Approaching a 50% dividend that looks sustainable, P/E ratio is closing in on 1. What are your thoughts on this stock?

Q: Hello 5i. Are the energy royalty companies like FRU and PSK exposed to the same kind of risks as individual energy companies, or are they different? Are they likely to cut their dividends in the current environment? Thanks.

Q: Canadian pipelines have suffered along with most of the market during this correction. My understanding is that they are protected by take or pay contracts with the producers. In other words you either take the capacity you agreed to or pay for it. The obvious concern here is that the producers opt to do neither, not having the money and facing bankruptcy. My first question is whether this is even true to any extent. Secondly, what would the response of the pipelines likely be? Do they ultimately become owners of non-producing oilfields?

Secondly my understanding is that shipping by pipeline is cheaper than shipping by rail. Given this scenario the remaining product should shift over time from the rail lines to the pipelines, keeping the pipelines full. The loser becomes the rail lines. Do you consider this to be true?

Q: Good Morning 5I research.I own Altas gas shares and with this massive sell off is it a good buy let say 15 dollars or less a share
Thanks

Q: Peter; I’ve read the current answers on KEY - would you add to it at today’s price? It seems to be trading like it may go bankrupt. Thanks. Rod

Q: Hello Team

I am not panicking with this correction, even tough I am way way down, this is not my 1st rodeo, been through a few of these, still I am in awe with the hit that energy stocks are taking, mid caps priced like they are going out of business. Anyways my question is bout the pipelines, do they normally charge a flat rate or a percentage of the wti price for shipping the product. I would assume that with the shortage of pipeline capacity they would be going full bore, why are they down so much
Thanks