Viewing Expert Josef Schachter | StockChase
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Compiling comments that experts make about stocks while on public TV.

Viewing Expert

Josef Schachter , President

Schachter Asset Management


Date Signal Chart Symbol Company Opinion Price
2017-04-07 N/A Must be logged in to use chart A Commentary A Comment -- General Comments From an Expert

Energy. There is still a massive glut in the oil market. The summer driving season is coming and demand is going to pick up by 1 million barrels. The problem is now April, May and June. US storage is at record levels, way above the five-year average. OPEC is hoping that with their 1.2 million barrel cut and the continuation of that cut through to the end of the year, that million barrels will allow things to grow in and begin to start to see inventories globally come down. In his opinion, OPEC is able to cut another 2 million barrels a day. In the past, when they made cuts, it hasn’t been one cut that has worked, it has been 3 or 4 cuts between a total of 3 and 5 million barrels. Also, risk premiums are coming back. 10-15 years ago there was a $5-$6 a barrel premium because of worries about the Straits of Vermouth, the Straits of Molokai, Yemen, etc. OPEC is hoping that the non-OPEC supply will give some credence and cut back, which to him it is a nonsensical idea. US is not cutting back. Canada is not cutting back. Mexico won’t cut back. Britain won’t cut back. They are hoping Russia will agree. The government of Russia is saying they are cutting back, but the 2 largest Russian players are selling every barrel they can.


Price:
$0.020
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
_N/A
2017-04-07 PAST TOP PICK Must be logged in to use chart BIR-T Birchcliff Energy Ltd.

(A Top Pick April 22/16. Up 64%.) The stock did fabulously well, and he pulled it off his recommended list when it got over $9. It is getting cheap again. BV is $6.64, and NAV is $9.27, so it is trading very cheaply. He likes their long-life reserves of 21.9 years proven RLI. He has a target now of $13. Any time you see any weakness below $7, it is something to start taking a look at.


Price:
$7.840
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
No
2017-04-07 COMMENT Must be logged in to use chart BTE-T Baytex Energy Corp

From a value perspective, this is a cheap stock. BV is $8.48. It was a $45 stock in 2014, and the low in Q1 was $1.57. What bothers him is that the company had $1.7 billion of debt against $1.9 billion in equity. When you have a reduced price in the commodity and less cash flow is coming in, you need to focus on the debt holders first, so you can’t put money back into the ground. That means your production is not going to grow. Production volumes have come down. In Q1 in 2016 they were 41,000 and in Q4 they were 33,000, so they don’t have enough money in the till coming in from cash flow to service the debt. His view is that this company is going down. He would say there was a 10% risk the company will not survive.


Price:
$4.590
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Unknown
2017-04-07 HOLD Must be logged in to use chart BXE-T Bellatrix Exploration Ltd.

This had its glory days in 2014 when it was $11.65. It is getting very, very cheap. The street is unhappy because of the debt load, but they have resolved that. There was concern about production and they are in the process of resolving that. He is beginning to think that this is attractive and has it on his watch list. BV is $3.50, so it is one of the biggest discount to BV out there. The balance sheet has been improved. They paid off their bank debt by asset sales. The debt load is now $360 million against $860 million of equity. His NAV calculation is $2.40, which is very good. Producing about 24% liquids and 76% natural gas. Production in the 4th quarter was 32,000 BOE’s a day, down from 40,700 from the year before. What he doesn’t like is that for a company that is that high in natural gas, production expenses are $10.57 BOE in the 4th quarter, and should be in the $6-$7 range.


Price:
$1.050
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Unknown
2017-04-07 COMMENT Must be logged in to use chart CPG-T Crescent Point Energy Corp

This was the darling of the street in 2014. With the erosion in the price and the balance sheet issues, they had to cut back on the dividend. They now have $2.7 billion of debt against $9.6 billion of equity. The BV is $17.61. It isn’t often that you have companies trading below BV. Thinks the stock will go down another $1-$2 because of concern about the balance sheet and not much growth.


Price:
$14.270
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Unknown
2017-04-07 COMMENT Must be logged in to use chart CVE-T Cenovus Energy

This company did 2 things. They added a ton of debt, which didn’t go well. (They were at $6.3 billion of debt at the end of December.) They added $10 billion of debt with their financing. They are now at $16 billion in debt. Their equity component was $11.6 billion and is now $18 billion with the equity issue that they did, plus the stock they gave to do the deal with Conoco. The problem is, BV is $13.91. Stock was trading at $16-$17 in January. The issue broke $16 and now is coming down. The low in Q1 of 2016 was $12.60, and he thinks it will go below BV at the end of Q4. The negatives are the balance sheets and that they are now going back to create Pan-Canadian. If the price gets down to $12-$13, he may start to do some work on it, because at that point it will be very cheap.


Price:
$14.770
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Unknown
2017-04-07 BUY on WEAKNESS Must be logged in to use chart DEE-T Delphi Energy Corp.

A Montney producer that has a deal with Repsol, where they got money from the government to help pay down debt. Now they are drilling together in some of the best lands that they have, in the Western part of the play. The wells that are coming out are fabulous. The problem is, they have 4 or 5 wells that they should be bringing on stream in Q2, but as a smaller company, getting access to the frac units is difficult. The stock is getting very cheap. He has a conservative BV of $.98. The balance sheet is in much better shape with $153 million in equity. The bank debt is $25 million and they have a million dollars in senior secured notes. They have a history of being a very good hedger. The low in 2016 was $0.22 and the high was $1.79 this year. If this gets below $1, he thinks it is a table pounding buy. This could get taken over because of their land position.


Price:
$1.500
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Unknown
2017-04-07 PAST TOP PICK Must be logged in to use chart GTE-T Gran Tierra Energy Inc.

(A Top Pick April 22/16. Down 4%.) Has a $4.60 target. They are doing a large amount of high impact exploration. If they pull that off, the stock will probably get to the $4.60 target.


Price:
$3.570
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
No
2017-04-07 HOLD Must be logged in to use chart HSE-T Husky Energy

They tried to repair the balance sheet, so it sold medium stream assets. Took the debt down from $5.7 billion last year to $4.7 billion. They’ve taken cash up to $1.3 billion. Equity is a very big component at $17.6 billion, so they are in pretty good shape there. BV is $17.53, and the stock is trading below BV. However, volumes are down on the year. They will be adding on more production by doing 10,000 barrels a day thermal projects. As those come on and they have more long life assets, that will be a positive. He likes that they are going to be adding more volumes in China. As the balance sheet repairs and as we get over $60 a barrel, maybe in 2018, they could reinstate a cash dividend again. He would continue to hold.


Price:
$15.150
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Unknown
2017-04-07 DON'T BUY Must be logged in to use chart IMO-T Imperial Oil

This has backed off. The high in 2014 was $56, and BV is around $30. He expects the stock to see lower levels.


Price:
$40.610
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Unknown
2017-04-07 TOP PICK Must be logged in to use chart IPO-T InPlay Oil Corp

This is a smaller company. A Cardium player in Western Canada. They have a good team. It is currently doing 3600 BOE’s a day and will be north of 4000-4200 by the end of the year. His 12-month target is $3.60. BV is $3. How many times do you buy a good growing company with a good balance sheet that is trading below BV? (Analysts price target is $3.25.)


Price:
$2.020
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
No
2017-04-07 PAST TOP PICK Must be logged in to use chart PGF-T Pengrowth Energy

(A Top Pick April 22/16. Down 24%.) Everybody has been wanting to see the balance sheet repaired which has been done.


Price:
$1.430
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
No
2017-04-07 TOP PICK Must be logged in to use chart PGF-T Pengrowth Energy

This was sitting at over $2 billion in debt. They just announced that they had paid down $500 million. Since then they have made 2 asset sales. Once they pay down the debt, they will be below $900 million. They are still looking to sell the Swan Hills which he thinks they potentially can for $250 million. This will be a company with an equity component of almost $1.8 billion and $600 million in debt, and they have solved the problem. The big thing is that Lindberg is ramping up, and right now they are at about 15,000 BOE’s a day over that, and by the end of the year that number will be 19,000 or 20,000 because they are doing 7 well-pairs to bring it on. They are also moving on phase 2, which will bring production in 2020 to 38,000-39,000 BOE’s a day. Once they have this debt out of the way, they can grow their Montney assets. BV is $2.71 and NAV is $2.75. He has a $3.60 12-month target. The bears are looking at the debt and are missing the point of the rising value of the asset base and the generating of cash. (Analysts price target is $1.75.)


Price:
$1.430
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
No
2017-04-07 COMMENT Must be logged in to use chart QEC-T Questerre Energy

The Québec government has finally put the ability for the “go forward” strategy on the Utica Shale to happen. Their partner is Repsol. The wells coming out of the Utica in the US are fabulous. He likes the company and their team. His problem is that if the government gives the green light to go ahead as fast as they can, does this company have the wherewithal to fund it. If it backs off below $0.60, you are just paying for Western Canada and you get Québec for free again.


Price:
$0.740
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Unknown
2017-04-07 TOP PICK Must be logged in to use chart SDX-X Sea Dragon Energy Inc.

This operates with a team out of Egypt. Producing 4000+ barrels a day now that will be 6 or 7 (thousand?) because they are drilling right now. The reason the stock has popped is because of a high impact well they are drilling which could have 400 BCF of gas and/or 100 million of oil. He has a target of $1.20 without any success of the drill bit. If the drill bit comes in, he will be raising his target by at least $1. (Analysts price target is $0.50.)


Price:
$0.900
Subject:
OIL & GAS
Bias:
BEARISH on OIL
Owned:
Yes
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