RE:EndOfTheLine for Peyto's......LoL - you lost me at Mr "MOMO"
Mo, as in, Momentum.
Nice
mrmomo wrote: outstanding stock performace performance.....despite VERY low Natural gas pricing? Imho, it most probably is..........
I've bee rec'd Peyto on here, to both familly & friends, and for anyone who's interested in good, stable divvy payouts & passive income. And this recommendation is going on two years now. And as recent late last year to early this year, where i've been telling folks to LOAD UP at these low prices. Why? Because despite low NG prices, Peyto is the lowest cost operator of NG in Canada AND the most important factor of all, they were able to service that "generous" divvy throughout that period.
But now is a VERY different story, from this point forward. And i've been rec'd folks, whether family or friends, to SELL and these prices. Why? Because due to the very hostile & expsensive nature of being a fossile fuel producer in Canada, along side the VERY low NG pricing not seen since 2020, even a low cost producer like Peyto will be dealing with "challengin issues" to stay proftiable and sustain their dividend.
A quickj look at their recenr financials are paiting and early picture, developping as we speak, of that very same scenario........a very bleak outlook for NG producers. Even for an efficeiny one such as Peyto. The company just "barely" took in enough revenue, the bare minimum required, to make that divvy viable & sustainable. Which i mentioned here not too long ago, about a year on this board, that at least a billion $$ was the "red line" so to speak that Peyto needed to hold to keep their divvy intact. And they just "barely" made it through 2023, by the tip of their nose, WITH decent hedges....
And this is where the problems will begin with Peyto and just about everyone else who's not Canadian Unatural, Arc or Tourmaline. Current Ng prcing right now is NOT conducive or profitable for even Peyto, to the point where a dividend might be a likely outcome. If Ng prices continue to stagnate in this area, below the $2.50 HH Peyto needs to hold the divvy as is.
So with their "lucrative" 2022 hedges expiring, after Q1 of 2024, Peyto and just about everyone elese, who's not the BIG 3 mentioned above, will be a world of trouble.......TRYING to survive. And with the US elections just over the horizon, the prospect of Trump being re-elected into office and jim implementing his "Drill Baby Drill" agenda on energy, he will reflood with massive amounts of cheap gas all over North America......once again! And this will not bode well for ANY Canadian ep who' heavily weighted towards the commodity, Peyto included.......unfortunately.
So my rec'd is to SELL at these prices, as i've been telling just about everyone who've i;ve rec'd the stock to and to stay on the sidelines UNTIL the elections for POTUS are sorted out and things become more lear as to NG pricing. Because should all the dominos fall into place, as i expect they will, it will be a VERY diffcult AND challenging period for the Canadian operators once again.....like it was from 2016 to 2020....
That MY 2, 3 cent worth of comments for this board today......Take it or leave it at your own PERIL!
GLTA