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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: How do you think SU will do in the next couple years and what would be your top 5 favorite energy plays in the Canadian Market? Also, with China reopening, US dollar on a downtrend and noticing several major Metal/Copper stocks gapping up like FCX and VALE, SCCO, how would you rank these and what are your top 5 companies domestic or international to take adv of rising commoditiy/metal prices
Read Answer Asked by Sheldon on April 17, 2023
Q: In a response to Chris on February 27th, you indicated OBE was OK but you thought TVE was better. I am curious what brought you to that conclusion. Maybe I get too caught up in simple metrics. For example, OBE has a PE of 1.0 and a PB of 0.52 compared to TBE where the same ratios are 4.3 and 1.3. I realize it is not as simple as that. I hope you can educate me on how to dig deeper into your preference for TVE. Thanks again for helping the little person.
Read Answer Asked by Danny-boy on March 03, 2023
Q: I want to re-visit a question I asked previously (based on Eric Nuttall's appearance on BNN Bloomberg) and Lionel's input on it. I've reproduced those questions and answers below for reference.

To clarify, Eric was not bullish on natural gas, at least over the next year. What he was feverish on was heavy oil, and his top picks were the three companies above.

I had mentioned Tourmaline Oil which perhaps shifted the conversation toward natural gas, but I was really interested in your take on the heavy oil companies.

Do you share his enthusiasm about heavy oil? I'd appreciate if you could rank these companies. CVE seems the biggest but I sense he sees more potential in the other two which are smaller.



Q: Eric Nuttall was very bullish, almost feverish, on oil (represented by the companies above) while being down on natural gas. To what extent do you agree?

Asked by Kevin on February 27, 2023
5I RESEARCH ANSWER:
We like Eric and used to work right beside him (Peter answering). He is bright and gained lots of experience over the past 20 years. He showed a lot of guts in the oil crash when his fund dropped 70% in three months and fell to $20M in assets (he now manages more than $2B). The sector is very cheap, and vs past cycles corporate balance sheets are very strong. Certainly the lack of spending may results in higher prices over the next three years (depending on the economy). But...it will always be cyclical. The price of oil in fact is even down 14% from before the Ukraine war started. But we think some sector representation certainly makes sense. The TSX is currently at 17.4% energy. We might consider that a bit on the high side. In terms of natural gas, it can be very weather dependent, but we would be more bullish than Eric; the price has dropped so much this year, but it is also dependent on drilling, and the price drop is going to cause even less spending to be done on new gas wells.

Q: I am optomistic that Peter and Eric Nuttall are bullish on the gas sector, as in the 5i reply to Kevin's query (Feb 27). What are your views on XES? Technically, it looks like it has a huge runway to the upside ...Thanks....Lionel

5I RESEARCH ANSWER:
XES is the SPDR Oil and Gas Equipment & Services ETF. Certainly there is upside potential as oil and gas companies spend. However, there has been a trend in the industry towards dividends and buybacks, so spending this cycle may be less than in other periods. Still, the fund is up 38% in the past year, and its 35 holdings look solid. We would be OK owning this for sector exposure, with the understanding that it is always going to be cyclical.
Read Answer Asked by Kevin on March 02, 2023
Q: Good morning 5i team!

May I please get your thoughts on ERF. I've held it for a while and have done well. I'm concidering rotating out of this name and shifting to either WCP, HWX or TVE all of which have better dividends and could run harder if oil catches a bid (as many oil bulls are expecting). Do you prefer any of these name over the others....or, stay the course. Thoughts?

Thanks

Dave
Read Answer Asked by David on January 23, 2023
Q: Hi Peter, Ryan and 5i team,
It’s that time of year to contribute to our grandson’s RESP (age 9). After rebalancing and adding new money we can add two stocks to the portfolio. To broaden the sectors , we are looking at utilities, healthcare, and real estate. Could you please suggest a name in each sector .
Thank you for your opinion.
Read Answer Asked by john on January 17, 2023
Q: Looking for what top 3 oil & gas recommendations you would have. Growth and appreciation over the next 2-3 years.
Read Answer Asked by Chris on January 12, 2023
Q: I know these companies vary a lot on the risk spectrum (CNQ likely being the safest and PXT the riskiest due to geopolitical risk), but if oil prices stay relatively high for the next couple years (let's say averaging at least $70), how would you rank the following stocks at current prices for potential total return: CNQ, TVE, IPCO, PXT?
Read Answer Asked by Patrick on January 05, 2023
Q: I am selling one or all of TVE,AC,KXS for tax loss. All are down similar amount . Would you please list from first to last your preference for disposal.
Read Answer Asked by Colleen on December 20, 2022
Q: Peter, it is my understanding that all three of these companies now have very low debt. They also have a very low p.e. They also have a very long reserve life. Is it true that renewable energy is many years away from being a viable solution for energy for the world? The share price for renewables has certainly shown that. ie. RNW Algonquin.
Is this huge drop in these energy companies due to the no more piplelines and no case for LGN, the Trudeau effect. Are these three companies still overpriced?? What would be a good entry point?? Is not a 9.5% div on Peyto the same as a 12% GIC after tax is calculated?? I would like your opinion on these questions Thanks Ken
Read Answer Asked by Ken on December 19, 2022
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