STOCKCHASE

5.290

Bonds 8% 2018: Capture an 8% return with as little risk as possible. Have ring fenced Madagascar and Cuba plus fixed volume contracts of 15 to 20 years in Canada. Sherrit just has to stay solvent.

2011-12-13

PAST TOP PICK

1.000

(Top Pick Dec 16/10, Down 63.63%)

2011-12-13

N/A

0.020

Market: A festival of tax loss selling. You will be right in the zone now. This is what starts feeling more like a bottom like a couple of years ago. People don’t want to deal with each other – this is the contagion. The European situation can only be solved by politicians so it is a speculative situation. The banks in the EU need to get better balance sheets and then things will start to roll.

2011-12-13

BUY

San Gold Corporation

SGR-T

1.520

Not a senior producer. They are caught in a situation where the market puts a small multiple on you after a certain amount of production. Likes it here but a few things he likes better for subtle reasons.

2011-12-13

DON'T BUY

Petrominerales Ltd.

PMG-T

16.300

The worst time to sell any stock. All the Columbia stories have come off. PMG really throws off a lot of cash. He would want to see bit of a base.

2011-12-13

BUY

Open Range Energy Corp.

ONR-T

1.650

Gas doesn’t seem to have a floor. Press it highlighting downside from flacking.

2011-12-13

TOP PICK

Cenovus Energy

CVE-T

32.950

Conventional natural gas assets and growing oil assets. Great business. Price is not that bad. With keystone pipeline going ahead, this is the non-mining oil sands company.

2011-12-13

PAST TOP PICK

Tourmaline Oil Corp

TOU-T

28.490

(Top Pick Dec 16/10, Up 28.04%) Lowest cost producer, best growth profile, best natural gas company in North America, probably will buy more if price comes off a little bit more.

2011-12-13

Comment

Canadian Natural Rsrcs

CNQ-T

36.170

Keystone pipeline from the oil sands is a big issue. We were essentially at 1.2 million barrels a day going to the US and this was going to add another 800,000 barrels in 2 years. Extremely important that these transportation projects go ahead. This is his favourite.

2011-11-22

DON'T BUY

Encana Corp

ECA-T

19.550

A trade play? 4.25% dividend yield. At this point in time, the market rarely goes down and this one should have a bounce from here. All their $6 hedges are now rolling off. It is going to have a really tough time. Tourmaline (TOU-T) is the cleanest one going and the only one he would touch.

2011-11-22

DON'T BUY

First Quantum Minerals

FM-T

17.450

Have got some great projects globally but have some political issues in Zambia. Also copper prices are coming off. Risk profile is getting better but falls in the country risk category.

2011-11-22

PAST TOP PICK

Inter Pipeline Fund

IPL.UN-T

17.970

(A Top Pick Dec 16/10. Up 26.78%.) Still thinks it can double the size of its assets in the next 10 years. This way you capture the dividends and still get the growth. He thinks he can get 10% compounded.

2011-11-22

DON'T BUY

Kinross Gold

K-T

13.620

Starting to have high-volumes but he doesn't know why. Hasn’t liked this one for a long time. Too much political risk.

2011-11-22

BUY

Northland Power Inc

NPI-T

16.700

He focuses on operating cash flow, low maintenance costs and throwing off of free cash flow rather than the dividend. Trades at a 12X multiple. If interest rates went up, this is how you would get hit. Because of low interest rates, there is a good income stream. 6.5% yield.

2011-11-22

TOP PICK

5.260

8% bond maturing Nov 15/18. Really likes the Canadian-based coal assets, which more than backs up the value of the bond. Allows him to lock in the 8% without worrying about what happens in the market.

2011-11-22

DON'T BUY

Suncor Energy Inc

SU-T

30.420

2011-11-22

PAST TOP PICK

Crescent Point Energy Corp

1.120

(A Top Pick Dec 16/10 Down 60.9%.) It is 10 million ounces of gold in South Africa going into production, which got delayed by a year with higher costs. Sold his holdings at a loss of about 10%-15%.

2011-11-22

BUY on WEAKNESS

Imperial Metals Corp

III-T

22.220

Important thing that any time you can find a big resource and it is in Canada, it's a way better than finding it in an obscure part of the world. If they could bring it on, and it looks like they are doing it in a methodical, cash flow generative way themselves, there is no reason why it shouldn't be able to double or triple in 4-5 years. Would have bought it if it had gone to $15

2011-11-22

Comment

CPG-T

43.100

Has a DRIP program with a 5% discount on the stock when they buy it for you. Very good at controlling debt.

2011-11-22

Comment

15.980

There is great internal momentum. Have projects that can double production in the next 4 years. If the gold price stays higher and they execute well, you can see it getting to $20.

2011-11-22

Comment

0.020

Markets. Best strategy is to focus on companies with good balance sheets, market leaders, pay dividends and somewhat defensive. Top Picks will be focused on trying to get 8%-10% rate of returns with low risk.

2011-11-22

DON'T BUY

Pacific Rubiales Energy Corp.

9.690

Only base metal company he owns. Likes this one the most if there is going to be a bounce in copper. Has a half position, which he can always add to when it pulls back. Still a couple of questions. They are building mines and it is the CapX around the mine and how you finance.

2011-11-22

WAIT

Osisko Exploration Ltd.

OSK-T

11.190

Was a growth company when they first found the asset and was putting it into production. The amount of gold in the rock is not what there. Now the mine has to be tweaked. Just the mention of that in a skittish market can knock it down.

2011-11-22

DON'T BUY

Thompson Creek Metals

TCM-T

6.200

If you get a great bull market in metals, this is what you would want to own. The problem with having a minor metal like molybdenum is that there is not a deep market for it.

2011-11-22

DON'T BUY

PRE-T

20.370

A fantastic growth story in Columbia but right now, the momentum is coming off. They have a depleting asset with all kinds of contract issues. There is no way to know where it is going to come off to.

2011-11-22

DON'T BUY

Franco-Nevada Corp.

FNV-T

44.710

Eliminating mining risks through a royalty program is a brilliant idea. The problem is, they are expensive. Starting to look at this one.

2011-11-22

TOP PICK

Cenovus Energy

CVE-T

31.540

One of a handful of extremely high quality companies. Low-cost, transparent growth and doesn't trade super expensive. Trading at 7X cash flow. 2.5% dividend. This will be in business for 20-30 years.

2011-11-22

PAST TOP PICK

Tourmaline Oil Corp

TOU-T

29.810

(A Top Pick Dec 16/10 Down 48.96%.) His only natural gas holding. Hard to recommend it as it is so expensive. He has taken a little bit of money out of it but hopes to ride it out. Probable takeover target.

2011-11-22

TOP PICK

Longview Oil

LNV-T

9.850

6% dividend yield. Have the oil assets that got spun out of Advantage (AAV-T). Great operating team. Dividend is 1/3 of cash flow and they'll use 2/3 to drill low risk development wells. They should be able to increase production gradually over time. Hoping for a 10%-15% return out of them.

2011-11-22

SELL

47.350

A great day for Canadian Resource names. They wrote down a key asset by about 10% of its value. They have one mine and something goes wrong. You need to diversify in the sector. If there is something wrong with the rock, then you can’t do anything. They can’t get the gold out of there. He sold it when it got expensive. It has nowhere to go. It is too complicated to say that today it is at the right price.

2011-10-19

DON'T BUY

Connacher Oil and Gas

CLL-T

0.440

Too much debt and they really get hit when oil comes off. He wouldn’t touch it. It is not a busted company. The asset is real but there is too much debt. Someone could come after it but they just want the asset. They will pay cash.

2011-10-19

TOP PICK

Inter Pipeline Fund

IPL.UN-T

16.600

(Top Pick Dec 16’2010 Up 15.30%) You have to go up the earnings stream to the guy that sends it through the pipe. 6% yield. Will grow at 2-3% a year. Very boring utility pipeline stories might become very interesting.

2011-10-19

BUY

4.540

A core holding. With commodities when the price of the commodity goes down you just run the thing flat out. In the nickel business, it is very high cost, and they shut down as soon as it goes down. So 7% of world production disappears as soon as it goes below $10. He writes Madagascar off as zero. Other business is very profitable. They have western Canada coal. Can easily make a dollar share and is yielding 3.5%. It won’t o to the moon. He can own it in this band.

2011-10-19

TOP PICK

Baytex Energy Corp

BTE-T

50.750

Low cost producer yielding about 5%. Has ability to grow. That’s all he is looking for in energy. Buy it when it comes off.

2011-10-19

PAST TOP PICK

Crescent Point Energy Corp

1.610

(Top Pick Dec 16’2010 Down 40.97%) It is hitting bumps and is costing to much and taking too long to get into production.

2011-10-19

BUY

CPG-T

42.860

We are not getting the full benefit of the price of oil. If oil price does come off, he will like up his top companies and will he have the opportunity to get it at a good price. It came into his price range.

2011-10-19

TOP PICK

14.490

Gold sold off and it should hold this. If gold goes up it is in the $20s. They have production waiting to come on. It is cheaper to buy something that has been discounted.

2011-10-19

N/A

0.020

Market: Cameco is only one mine. If something goes wrong, the stock drops dramatically. CCO is a really super power in uranium. He thinks Rio will stick to their price. These won’t get political.

2011-10-19

DON'T BUY

Lundin Mining Corp.

LUN-T

4.020

It probably gets sold at some point but he chooses not to get into it.

2011-10-19

PAST TOP PICK

Tourmaline Oil Corp

TOU-T

32.110

(Top Pick Dec 16’2010 Up 62.48%)

2011-10-19

DON'T BUY

Barrick Gold

ABX-T

52.880

With the increase in gold prices, the profitability of this company is incredible right now. Trading at NAV for the first time in a long time. Doesn't particularly like this one because it is so big. It is hard for it to grow its business. Would like the company half the size that is profitable and can incrementally grow its business.

2011-09-19

PAST TOP PICK

Labrador Iron Mines Holdings Ltd.

67.200

(A Top Pick July 6/10. Up 13.17%.) Had an incredible rally last fall and got too expensive so switched to Yamana (YRI-T)..

2011-09-19

PAST TOP PICK

Bonavista Energy Corp

BNP-T

23.950

(A Top Pick July 6/10. Up 12.39%.) Still yields 6%. Very high-quality business and they have the ability to do counter cyclical acquisitions.

2011-09-19

DON'T BUY

Connacher Oil and Gas

CLL-T

0.560

Producing in the oil sands but the problem is they took on an awful lot of debt. Anytime the oil price goes up, they can repay their loans, but if the sentiment is that oil price is going to come off, it gets crushed.

2011-09-19

TOP PICK

Canadian Natural Rsrcs

CNQ-T

33.480

A great Canadian company. Low cost producer. Have assets including shale gas, oil sands and gas so they can toggle between the businesses or even sit on their hands if they choose to. Attractive valuation at 5X cash flow.

2011-09-19

Comment

Canadian Oil Sands

COS-T

21.830

Compelling yield and makes lots of money, which is extremely important in this market. Long life, high-quality income producer. If oil prices come off, there will be more opportunity to add to it. A consortium so expansion is really problematic. Looks like it will get on top of its efficiencies in 1-2 years time. Prefers Imperial Oil (IMO-T).

2011-09-19

DON'T BUY

Husky Energy

HSE-T

23.480

Doesn't hit the same metrics as other companies and is not entirely transparent.

2011-09-19

BUY on WEAKNESS

Ivanhoe Mines

IVN-T

19.420

Incredible deposit in Mongolia and it looks like Mongolia will be pro-mining for a long time. Copper has just tipped over and looks like it might be in a freefall and you don't know where it's going to land. Not happy with the political risk. If he didn't own Hudbay (HBM-T) he would start to look at this one. Would like to see it in the $15 range. (See Top Picks.)

2011-09-19

DON'T BUY

LIM-T

7.600

If iron ore stays in this valuation range, they could get into the teens. The problem he has with iron ore right now is if China goes into a slowdown, they have too much steel capacity so the inputs to steel will have some kind of hiccup.

2011-09-19

PAST TOP PICK

Crescent Point Energy Corp

4.910

(A Top Pick July 6/10. Down 16.11%.) In a year or so it should be able to earn $1 so at $5 it will be at 5X earnings. 3% dividend yield. It can be very profitable at $9-$10 nickel.

2011-09-19

BUY on WEAKNESS

CPG-T

41.760

Safety of the yield is a tough thing to analyze. This company is pretty conservative on its distribution. One of the best companies with a long life asset. Very profitable company. If it were another $3-$5 lower it would come into his window of evaluation. 6.6% yield.

2011-09-19

Comment

Uranium One Inc.

UUU-T

2.460

Uranium is a really small market and there are only a handful of companies. This one would be a much higher quality one. Very well run. Is in exotic places so when liquidity gets sucked out of the market this does not participate in the market, no matter how much money it is making. Trading at about 10X earnings and is at an okay price.

2011-09-19

Comment

0.020

Economy. It's all about too much debt. 3 years ago, banks had too much debt and they transferred it all to the governments. Now the government has too much debt. How do they get rid of it? Either the taxpayer pays for it on the banks consume it. All it does is slows things down. It is the velocity of money and there is no demand for money. You want high-quality companies that have free cash flow.

2011-09-19

Comment

0.020

If Keystone pipeline goes through, what resource stocks would benefit? It should impact all heavy oil-light oil producers in Western Canada. It's incredibly important.

2011-09-19

TOP PICK

11.870

Copper. Have a couple of growth projects in Canada as well as one in Peru. Looks like they could have $1-$2 billion in gold assets that they could spin out. Price could drop below $10, which would be uncomfortable, but would give him an advantage to buy more.

2011-09-19

DON'T BUY

San Gold Corporation

SGR-T

2.790

What is unfortunate is the dilution through the issuing of more and more shares. Got bogged down on production issues and defining the gold resource. Not enough gold to get the market really interested.

2011-09-19

BUY

Lundin Mining Corp.

LUN-T

4.730

Now that sentiment is lower and copper is coming off, this is a great time to start being a resource investor.

2011-09-19

DON'T BUY

Thompson Creek Metals

TCM-T

7.430

Molybdenum is pretty unstable because of the way the commodity is traded on a global basis. When you are in a rollover market like the current one, you have no idea how much this is going to fall. If it gets washed out and there is cash value, then he would start looking at it.

2011-09-19

TOP PICK

Longview Oil

LNV-T

9.890

Spun off out of Advantage (AAV-T). Oil assets that were stranded inside a gas company. Can drill them up very efficiently over the next 2 years. Very profitable company. Great place to hide and collect your 6% dividend.

2011-09-19

PAST TOP PICK

Potash Corp of Saskatchewan

62.630

(A Top Pick July 6/10. Up 4.86%.)

2011-08-17

PAST TOP PICK

Bonavista Energy Corp

BNP-T

25.850

(A Top Pick July 6/10. Up 19.98%.)

2011-08-17

DON'T BUY

POT-T

54.180

Hopefully they make $4-$5 a share next year in this good agricultural market, but a cyclical business like this should trade at 10X earnings i.e. $40. Owning this you are actually playing that potash prices go up, which is really hard to predict. Would rather wait until it gets hit and drops 30% or more.

2011-08-17

TOP PICK

5.640

(A Top Pick July 6/10. Down 9.51%.) If nickel falls below $10, 6% to 7% of global supply will stop so this company just needs to stay above $5 for them to make a significant amount of money. Expect the stock will get back to $8-$10. 2.8% yield.

2011-08-17

BUY

15.200

South American focused gold company. Great existing mine with a great pipeline and well managed, which you can buy at basically NAV.

2011-08-17

PARTIAL BUY

Grande Cache Coal Corp.

GCE-T

6.840

Great little company that produces high-quality coal. It has high costs producing. If China slows down, and it could, this would be the canary in the coal mine because of high costs. Feels that China will be fine. Buy now to start with the idea of making further purchases when it drops further.

2011-08-17

TOP PICK

12.330

Has lots of cash flow stream, some great growth projects, which are all reasonable sizes and in great jurisdictions.

2011-08-17

PARTIAL BUY

Lundin Mining Corp.

LUN-T

5.450

There are only 4 or 5 base metal companies to choose from in Canada but it has a bit of an overhang because of their Congo mine. Too much risk for his clients. Now down to a price (4 or 5 times cash flow) where the world really would have to fall apart. This is a place where you want to start picking it up.

2011-08-17

HOLD

Nautilus Minerals Inc.

NUS-T

3.090

Pushing the envelope by mining under the ocean. If you buy this, you are buying into what they are trying to do and you ride it out. Still at the stage where it looks really good but he can't put numbers to it.

2011-08-17

DON'T BUY

Noront Resources Ltd.

NOT-X

0.540

Has a minable resource. Real problem is who is going to develop it and how much is it going to cost. No one needs this kind of asset right now so this ends up as a wildcard kind of investment.

2011-08-17

TOP PICK

Cenovus Energy

CVE-T

35.440

Low cost producer in the oil sands dealing with environmental issues. Long-term hold for him. Good price.

2011-08-17

BUY

Barrick Gold

ABX-T

43.250

If you picked Barrack to be your gold exposure, this is a good one. It is too bug to grow. The people running it understand that. He likes it, but there is not enough growth to interest him.

2011-06-09

PAST TOP PICK

61.180

(Top Pick Jul 6/10, Up 1.03%) There were having operation problems last year. He moved to YRI. But it is not a bad time to look at it again.

2011-06-09

PAST TOP PICK

Bonavista Energy Corp

BNP-T

29.210

(Top Pick Jul 6/10, Up 30.02%) Core stock, 5% yield.

2011-06-09

BUY

Imperial Oil

IMO-T

45.500

A core position for him. Stock has ability to go to sleep on you but there is internal growth. This is a great stock for him to have in the core of his portfolio. Has not fallen enough for him to get excited enough to buy more. He trimmed back when it got too high.

2011-06-09

BUY

Kinross Gold

K-T

15.250

Value Growth Gold growth name. Gold has stayed high. Hold is 2 or 3 hundred dollars more than where these companies are being valued. Gold could come down and the stock could go up 30-40%. Stick with it. It should be bottoming. He was not as comfortable with going into equator and Russia. He prefers YRI

2011-06-09

WAIT

Niko Resources

NKO-T

72.700

Successful Canadian company on a global basis. Have discovered some of the biggest finds going. Stock has come off and he is looking at hit actively. His only problem is that in Europe and Russia, Nat Gas sells as a ratio to Oil, rather than market price.

2011-06-09

PAST TOP PICK

7.190

(Top Pick Jul 6/10, Up 20.77%) Thinks it will become a major nickel producer

2011-06-09

DON'T BUY

Westshore Terminals Inc.

WTE.UN-T

24.770

Value it like a bond. What could a pension fund pay for it? There are more interesting things he could buy out there.

2011-06-09

TOP PICK

11.600

Now that gold has run up, he wants companies that haven’t. They have a discount but are getting over the reasons for it. Gets the growth profile, management issues are being addressed and an attractive company, building their business.

2011-06-09

TOP PICK

14.050

There are only a couple of names in North/South America that are relatively cheap. He would double his position if it goes lower from here. You aren’t paying a lot for Peru.

2011-06-09

WAIT

Anderson Energy Ltd.

AXL-T

0.930

Long reserve life, but balance sheet is in trouble. You want to see the stock make a bottom.

2011-06-09

DON'T BUY

Gran Tierra Energy Inc.

GTE-T

6.260

Likes Columbia’s prospects. High quality company. Is uncomfortable with them going into Peru. They are talking about raising royalties. You are starting from scratch with infrastructure. This one is not quite cheap enough for where he would like it.

2011-06-09

TOP PICK

Longview Oil

LNV-T

11.500

Oil properties inside Advantage. They spun out the oil assets. Fairly low risk oil assets. Now they can extract the value from the properties. Went public in April. Thinks they can double production over the next two years.

2011-06-09

PAST TOP PICK

Potash Corp of Saskatchewan

61.230

(A Top Pick April 13/10. Up 2.78%.) Had operating problems this time last year. AS the gold was there, he felt the problems could be fixed, which happened. Got expensive and he sold at around $80.

2011-04-18

TOP PICK

Canadian Pacific Rail

CP-T

59.790

Great Canadian infrastructure. Relatively cheap. Moving things by rail is going to be essential in the next 10-20 years.

2011-04-18

PAST TOP PICK

Imperial Oil

IMO-T

48.820

(A Top Pick April 13/10. Up 18.67%.) They make a ton of money of about 9%-10% a year. Long term hold for him.

2011-04-18

HOLD

Niko Resources

NKO-T

80.570

A company that is this good, he could never get it cheap enough. They just seem to be able to keep hitting these massive finds.

2011-04-18

DON'T BUY

POT-T

53.250

Fantastic company but it’s expensive at 15X next year’s earnings. Because it’s so unique it gets a premium valuation. Investing 101 says don’t pay more than 10X earnings for it.

2011-04-18

Comment

Suncor Energy Inc

SU-T

41.140

Hard for him to strip all the numbers out of it to get to the real value. Did well and participated with oil but was relatively cheap. Prefers Imperial Oil (IMO-T).

2011-04-18

BUY

2.390

Incredibly undervalued. Set up and going into production with 10 million ounces in South Africa. South Africa is not that bad a place. $1,500 gold will not affect this company the same as others as this is an execution story. If they can get mining at a price (he wants to give them a bit more time of 6 months or a year) then you have a great flowing asset. Should be a $5 stock.

2011-04-18

DON'T BUY

Uranium One Inc.

UUU-T

3.860

2011-04-18

TOP PICK

12.060

Hasn’t really struggled as a company but there have been issues about getting mines going in South America so has ended up in the penalty box. Feels they have addressed the issues and thinks they will be able to increase production by about 50%. One of the only stocks that is really trading at NAV.

2011-04-18

Comment

0.020

Standard and Poor cut their outlook on the US debt rating from stable to negative. Doesn’t really impact in any particular way. Too much debt in the US. Is the government going to do anything about it? Not until bond market prices bond at a price where they have to do something. We worry about US or Europe being slow, but what would bother Canada is that China is on fire and they are trying to slow it down a bit. About 50% of the stocks on the TSX are resource and that is what affects our market. What is important is that the world is growing, companies are able to participate in global growth and Canada has a stable system.

2011-04-18

Comment