Investment Q&A

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

Q: Hello Team,
Both are large with now, high dividend. Which would you choose for sector exposure and why.
Thank You,
Barry

Q: A few times I've seen replies to member questions about oil companies and their debt to cash flow metric (OXY and OVV ring a bell, and 5X and 3X respectively ring a bell too, if I remember correctly). Are you calculating this? I don't see it in security details in 5i or my broker's site (or on other finance sites). Is it a question of having to read the balance sheet and cash flow statement, and if so what are you comparing? "Total Debt" (rather than "Total Liabilities") to "Total Cash from Operations" for the year ? For OXY the data I get presented (source is Morningstar via online broker) are Cash from/Used by Operating Activities + Cash from/Used by Investing Activities + Cash from/Used by Financing Activities = Increase/Decrease in Cash, however, I'm guessing you just use the first number, which for 2019 is 7.3 billion (so 38.6 debt / 7.3 total cash from operations = 5X)...is that correct? or do you get the ratio from somewhere else? Thanks

Q: Hi folks,looking longer term, Whitecap resources wcp/t had fairly decent Q results with Paying down $100M in debt,lowered payout ratio to 72,and there has been lots of recent insider buying at higher levels. Stock currently crushed to 1.30sh level....aside from problems/negativity of world/wti oil....does Whitecap not seem like a reasonable buy here??? thanks as always, jb

Q: I know you are not a fan of Baytex. I hold it and Vermillion. Can I get your thoughts on their ability to survive this onslaught? I realize you have no way to know where oil prices will land and for how long they will stay depressed, but can BTE and VET take concrete measures to ensure they survive ?

Q: These companies are trading at close to 10% yield. The share price is back to where they were ten years ago and the dividends have since doubled. Are these companies not the buy of a generation right now? In my life I will likely never see these valuations again. Or I missing something huge??

Q: Oil analysts on BNN have said the producers with good hedges on will do the best through this price war and corona virus impact. What large, mid and small cap producers hedged out for several months this year or further? Thanks

Q: Can you please advise as to which large cap oil sands company have hedged their oil price exposure and for how long and which would u recommend among that list. Thx

Q: With the company size and global oil/gas outlook, would you expect ENB to recover what it has lost over the next 2-5yrs, or do you believe there is some risk they may never fully recover?