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Compiling comments that experts make about stocks while on public TV.

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Eric Nuttall , Portfolio Manager

Sprott Assett Management


Date Signal Chart Symbol Company Opinion Price
2015-01-20 N/A Must be logged in to use chart A Commentary A Comment -- General Comments From an Expert

Energy. Thinks we are getting close to a low in the actual price in oil. If you look at the price action of  stocks relative to oil, oil itself was not up hugely, but the price of oil stocks had a huge rally, so there has been a positive divergence between stocks and the commodity itself. At today’s oil price the entire oil/gas sector is literally bankrupt. You can’t use current oil prices to compute stock values because it would mean the value of the stocks are either 0 or negative. He is finding better value in mid-caps because people are still risk adverse to volatility, and there has been a total abandonment of that kind of $1-$2 billion segment because they are flocking to the midstreams, pipes and large caps. If you are lucky enough not to have had energy exposure, dollar cost average over the next couple of months. In this price environment there is no clear catalyst to form a bottom in oil. It will be a gradual process. As we start to see the rig count decline, that will portend a future supply growth stalling followed by negative growth rate if the oil price oil stalls. Given the financial leverage of companies, they are now forced to only spend their cash flow. At current oil prices that realization will be the largest drop in CapX, year-over-year, in 2 decades. There will be a meaningful supply response, and he thinks this will catch people off guard at both the rate and the timing. Most people think it is going to be a 2016 event, but he thinks it is going to show up in Q3 of this year.


Price:
$0.020
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
_N/A
2015-01-20 N/A Must be logged in to use chart A Commentary A Comment -- General Comments From an Expert

Eric’s comments on oil stocks. When he talks about a “Good Buy”, his view on the macro is that we have another 1 to 2 quarters of volatility, because he cannot identify a catalyst that is going to immediately get the price of oil going. It is going to be a slow process, and you have to take a 9-12 month viewpoint


Price:
$0.020
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
_N/A
2015-01-20 COMMENT Must be logged in to use chart AC-T Air Canada (B)

This has been strong; not only because of oil prices, but because of some cost reduction initiatives where they’ve been expanding their fleet of Boeing 777’s where people are crammed in like sardines. Have just had the start of the rollout of the Boeing Dreamliner, which has much lower fuel consumption, along with Rouge where they’ve had some cost reductions as well. Stock has been pretty strong this year, but is still trading at a discount to WestJet (WJA-T) and its US peers. If you are a bear on oil, this is not a bad bet.


Price:
$12.380
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 COMMENT Must be logged in to use chart BNE-T Bonterra Energy Corp

To the best of his knowledge, this company does not have any oil hedges in place, nor reduced their dividend, but thinks it is imminent given that companies cannot grow production at $50 oil and pay a dividend. They have a good position in the eastern core of the Pembina field. At sub-$50 without any hedging, he thinks there will be a realignment of the dividend.


Price:
$37.990
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 COMMENT Must be logged in to use chart BNK-T Bankers Petroleum

The stock has been pounded along with everything else. What is not working in this company’s favour is that they have about a 20% differential to Brent, so their cash flow is more sensitive to the change in price of oil than to a light oil producer. If you are an oil bull and can be patient and want to buy it and look out a year, it is highly likely it is going to be higher, but over the next 6 months he doesn’t feel that he absolutely must own it. He’d rather get paid to wait with some dividend names.


Price:
$2.660
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 COMMENT Must be logged in to use chart BTE-T Baytex Energy Corp

If you believe, as he does, that oil prices are going to rally to $65-$70 by the end of 2015, then this is a great buy. You are going to have to be able to stomach the volatility. Have cut their dividend once. Given their perceived high leverage, the dividend could be in jeopardy if oil stays where it is. They have some of the very best assets in heavy oil in Canada, as well is the best liquid rich play in the Eagleford along with the best acreage.


Price:
$17.660
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 PAST TOP PICK Must be logged in to use chart CJ-T Cardinal Energy Ltd

(A Top Pick Jan 13/14. Up 15.74%.) 2 things are benefiting this company. 1) Their decline rate is very, very low, and 2) they have a pretty good balance sheet and hedging position. About 33% hedged this year at $97. Very, very low debt situation. The only negative is that their oil is medium grade, not heavy and not light, so there is a price discount.


Price:
$13.130
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 DON'T BUY Must be logged in to use chart CQE-T Cequence Energy Ltd.

If you are not a bull on natural gas, which he is not, this company’s wells historically have had a pretty low liquids cut given were they are in the deep basin. If you compare this to some other companies, you are much more reliant on the price of natural gas to determine your payback. Unless they come out with some boomer wells, he is really challenged to come up with a Buy thesis.


Price:
$0.960
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 COMMENT Must be logged in to use chart CR-T Crew Energy Inc.

This is in an OK situation. Debt to cash flow would be around 3X using $50 oil, so it’s not terrible and better than the average. This is in some of the better areas of the Montney’s, a very liquids rich play. Also, have an emerging oil play in Tower. They recently dropped their CapX along with everybody else, so production growth this year is kind of anaemic, to protect the balance sheet. He would rather own a company with a sustainable dividend.


Price:
$5.830
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 TOP PICK Must be logged in to use chart DRT-T DIRTT Environmental Solutions

They do office customization including customized glass, drywall for hospitals. For offices, such as Google and Netflix, they customize to make them look really cool. One of the few organic growth stories in Canada. Organically growing their revenue by over 25%. Thinks they will earn about $0.20 this year and visibility is $0.30 next year. Just starting to hit the point where they are utilizing enough of their plant to get more margins, so there is potential they will exceed 50% EBITDA margins this year. Bidding on some contracts in Singapore and a few other countries. A huge play on the build out of the US housing market and office space. A cheap stock.


Price:
$4.180
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 COMMENT Must be logged in to use chart EH-T easyhome

Just acquired 47 Cash Store locations. Really likes this company. A fantastic Canadian company. They are an instalment lender, not a pay day lender, which is higher rate interest borrowing. The business model has amazing margins. For every $100 million that they lend out, they basically take in $20 million of net income, so it is extremely profitable. Looking at the rollout of their loan book this year, it is increasing roughly by $100 million. A lot of this type of stock has been weak recently on concern that they have a lot of exposure to oil, but the real factors to look at are unemployment and food inflation. Trading at around 6X next year’s earnings.


Price:
$18.470
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 HOLD Must be logged in to use chart IKM-X Ikkuma Resources

People have absolutely no appetite for micro cap stocks. He likes the management team, who are experts in the Calgary foothills. He is waiting on a well result which should be out soon and is hoping it is positive. His strong predisposition is to buy mid-cap oil, preferably light oil, with some hedging and a strong balance sheet.


Price:
$0.760
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Yes
2015-01-20 COMMENT Must be logged in to use chart LEG-T Legacy Oil and Gas Inc.

Balance sheet was a little too high at $60 oil, and now we are in $48 oil for the time being, so leverage is becoming more and more of an issue. Thankfully they don’t have dividend stress on their balance sheet, but at the current oil price, their debt to cash flow is an excess of 6 times. They will be in a stressed environment and may have to explore non-core asset sales.


Price:
$1.510
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 COMMENT Must be logged in to use chart LRE-T Long Run Exploration

This is 55% gas. Roughly 20% hedged at $93 this year. Dividend is not safe.


Price:
$1.250
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
2015-01-20 COMMENT Must be logged in to use chart LXE-X Leucrotta Exploration Inc.

Pretty much a pure play as a natural gas producer in the liquids rich area of the Montney’s. This is more of a resource story than a cash flow story, given that they have locked up around 170 net sections in the Montney fairway, in an area where they have had very good success as has had Tourmaline (TOU-T), a couple of sections away. By his math, this company is going to have to come back to market in 2015 for funding. Sustainability, at today’s prices, might be slightly challenged.


Price:
$0.900
Subject:
CANADIAN SMALL & MIDCAPS
Bias:
UNKNOWN
Owned:
Unknown
Showing 1 to 15 of 854 entries
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5 Comments

petersirie

December 17th 2012 at 6:46pm

Keep up the quality commentary please. I have really appreciated your insight.

boblewellyn@yah

March 16th 2013 at 7:50pm

There is a report that Petrobakken has started a gas injection program that has substantially increased their production and reserves. Stock closed at $9.50 on Friday, March 15, 2013, probably because of this report.

car2nz

April 10th 2014 at 3:12pm

When Eric says BUY...You should be SELLING ...When he says Sell...You should be BUYING. He is consistently WRONG! It's amazing!

BeauRegard

April 21st 2014 at 3:36pm

Not the sharpest knife in the drawer!

CH-Investments

April 26th 2014 at 10:04am

Not a fan of all his picks but some of them have great potential to generate a large profit. Have found a number of decent picks here and have done my own analysis which has made me operate at a decent profit.


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