Big news for Peyto anyway(Direct pipeline to Cascade, I would add to Pey before BIR, I like Jeff T but its a big div and NGas needs more cold weather..
"He added that a new gas generating facility, the 900 MW Cascade Power Project near Edson, is in the commissioning stages and has been intermittently supplying power to the grid."
I agree. I hold 70,000 shares of Peyto. Both companies are exposed to the weather and both will benefit or suffer from cold or warm winters. Peyto has the best expansion plan with the Repsol acquisition and may be a bidder for Birchcliff over time.
The cut was a good idea, Gear also cut its div in half a few months ago, still hasnt recovered, the Canadian oil/gas discount that comes with distance is larger than what Russia has to deal with it sometimes seems. Gear's monthly report(today) shows they real juggling debt costs despite rising production... Its too bad since they were running zero debt not too long ago
Great reality check. Will add more to my BIR.TO position tomorrow if it sells off. Already have lots of PEY.TO. I think Jeff Tonken retired or is retiring. I like that guy though.
Thank you. I own shares in CNQ since 2005. Sold all my Natgas shares in US in 08 2023 in anticipation of a price drop. In the H1 of 24 I expect Natgas to be under pressure. If prices are reasonable, would be in search of a good CAN Natgas producers. Cheers and good luck with your LLM studies. You are my hero!
Yeah, I am really crying the blues having bought BIR at $0.88, received over $1.00 in dividends, and have an ongoing yield over 40% of my cost. I feel terrible at this dreadful outcome. Try to spend your claimed "up 40%" on MEG without selling the stock and paying tax on the claimed gain, and tell me why an oil company is comparable to a gas company. I will wait.
its okay, for the majority of investors who care about TOTAL RETURNS over the past year or two, they already know that buying companies that can't cover their dividends with free cash flow is a losing game.
lol!! Way to reference the covid lows as your cost basis, which is only 4 years ago!!
Most investors look at 1 year returns not what happened 4 years ago during a global pandemic.
You sure know how to pick great companies!!
I would much rather sell a company for a 40% gain and pay taxes than hold a loser that is down 40% and not pay any taxes. Your reasoning is so incredibly flawed you should be embarrassed.
My time frame for investments is decades. Rather than becoming embarrassed, I have become quite wealthy. I wish you well on your efforts to time the market and benefit from your view that trading will make you money - although for certain if you do it will be at the expense of others with less ability to time the market than yourself since trading is a zero sum game.
You better tell Stanley Druckenmiller to stop timing the markets then because clearly trading isn't working well for him.
I love how when people are wrong over a 1-2 year period they suddenly proclaim their time horizon is in the decades....because people will really remember someone's call from a few decades ago!
It's hard enough to trade on a short term horizon, it's nearly IMPOSSIBLE to know what's going to happen DECADES away from now.
I like Birchcliff, well run company, howver sold out on technicals. If it can hold at support at 3.50 and change its trend, I would be interested. Like the author said, fundamentals look ok longer term.
The price of Birchcliff speaks for itself. So does the dividend cut. Sure you got in at a cheap price. That means nothing to somebody who’s holding the stock today and has to make a decision about its future.
That number can be anything you want based on underlying assumptions. The strip is lower, therefore the reserve value will be lower when recalculated and since things are trading at 3 x , the hurdle rate should be 30% not 15%. Who knows what revenue will be over the next 28 days let alone 28 years.
At a 30% hurdle rate, the value is ~CDN$10 per share. Black Sholes explicitly recognizes the volatility in commodity prices and the calculation takes that into account. The 3x rate is from a very low base and not useful for a 28 year investment. The number is determined by the assumptions but cannot be anything you want. Use your own assumptions, do your own math, and accept the fact that valuation estimates are useful even if fraught with error.
Big news for Peyto anyway(Direct pipeline to Cascade, I would add to Pey before BIR, I like Jeff T but its a big div and NGas needs more cold weather..
https://edmontonjournal.com/news/local-news/extreme-cold-alberta-system-operator-warns-of-rolling-blackouts-saturday
"He added that a new gas generating facility, the 900 MW Cascade Power Project near Edson, is in the commissioning stages and has been intermittently supplying power to the grid."
I agree. I hold 70,000 shares of Peyto. Both companies are exposed to the weather and both will benefit or suffer from cold or warm winters. Peyto has the best expansion plan with the Repsol acquisition and may be a bidder for Birchcliff over time.
The cut was a good idea, Gear also cut its div in half a few months ago, still hasnt recovered, the Canadian oil/gas discount that comes with distance is larger than what Russia has to deal with it sometimes seems. Gear's monthly report(today) shows they real juggling debt costs despite rising production... Its too bad since they were running zero debt not too long ago
I don't think NAV is the best way to value a gasco that is cash flow negative...
Great reality check. Will add more to my BIR.TO position tomorrow if it sells off. Already have lots of PEY.TO. I think Jeff Tonken retired or is retiring. I like that guy though.
He retired Jan 1st 2024- https://calgaryherald.com/business/energy/birchcliff-energy-announces-ceo-transition-jeff-tonken-to-retire But still chairman of the board.
Mr. Blair, pls allow me to ask.
What oil or gas company in or outside your portfolio you consider best managed? (Regardless of what its share price does.)
Tourmaline and Peyto would be my choices, both equally well run. In oil based, CNQ stands out.
Thank you. I own shares in CNQ since 2005. Sold all my Natgas shares in US in 08 2023 in anticipation of a price drop. In the H1 of 24 I expect Natgas to be under pressure. If prices are reasonable, would be in search of a good CAN Natgas producers. Cheers and good luck with your LLM studies. You are my hero!
nothing like a company that only pays a dividend and does zero buybacks yet still goes down 40%
Whereas Meg pays zero dividends and does massive buybacks and is up 40%
That's a 80% delta
Remember when you said buybacks were a horrible allocation of capital? Boy have you been dreadfully wrong
Yeah, I am really crying the blues having bought BIR at $0.88, received over $1.00 in dividends, and have an ongoing yield over 40% of my cost. I feel terrible at this dreadful outcome. Try to spend your claimed "up 40%" on MEG without selling the stock and paying tax on the claimed gain, and tell me why an oil company is comparable to a gas company. I will wait.
its okay, for the majority of investors who care about TOTAL RETURNS over the past year or two, they already know that buying companies that can't cover their dividends with free cash flow is a losing game.
lol!! Way to reference the covid lows as your cost basis, which is only 4 years ago!!
Most investors look at 1 year returns not what happened 4 years ago during a global pandemic.
You sure know how to pick great companies!!
I would much rather sell a company for a 40% gain and pay taxes than hold a loser that is down 40% and not pay any taxes. Your reasoning is so incredibly flawed you should be embarrassed.
My time frame for investments is decades. Rather than becoming embarrassed, I have become quite wealthy. I wish you well on your efforts to time the market and benefit from your view that trading will make you money - although for certain if you do it will be at the expense of others with less ability to time the market than yourself since trading is a zero sum game.
You better tell Stanley Druckenmiller to stop timing the markets then because clearly trading isn't working well for him.
I love how when people are wrong over a 1-2 year period they suddenly proclaim their time horizon is in the decades....because people will really remember someone's call from a few decades ago!
It's hard enough to trade on a short term horizon, it's nearly IMPOSSIBLE to know what's going to happen DECADES away from now.
I like Birchcliff, well run company, howver sold out on technicals. If it can hold at support at 3.50 and change its trend, I would be interested. Like the author said, fundamentals look ok longer term.
The price of Birchcliff speaks for itself. So does the dividend cut. Sure you got in at a cheap price. That means nothing to somebody who’s holding the stock today and has to make a decision about its future.
his holding period is apparently DECADES so what happens in the next 9 years doesn't matter!!!
That number can be anything you want based on underlying assumptions. The strip is lower, therefore the reserve value will be lower when recalculated and since things are trading at 3 x , the hurdle rate should be 30% not 15%. Who knows what revenue will be over the next 28 days let alone 28 years.
At a 30% hurdle rate, the value is ~CDN$10 per share. Black Sholes explicitly recognizes the volatility in commodity prices and the calculation takes that into account. The 3x rate is from a very low base and not useful for a 28 year investment. The number is determined by the assumptions but cannot be anything you want. Use your own assumptions, do your own math, and accept the fact that valuation estimates are useful even if fraught with error.