Post by
stocks123ST on May 06, 2022 4:51am
Everything except ONE!
SGY delivered better results!
With the price of the stock going up, the ~4% yield is in line to what Paul was directing...
The hedge will secure the dividend for years and if SGY can have success in their drilling,
the extra production can be sold on the spot market rather than hedged.
The hedge is a downer because it is probably $20 below the spot, but the spot can easily go
down $10 in one day...
Anyway, the one area that I disagree with mgnt is on the buyback...
The buyback should be done ONLY at the time when the stock is making a NEW LOW!!!
If SGY are able to get a line of credit on demand, the money for the buyback should go to
reduce the debt..
This way, because their debt is reduced, the bank will lend the money for buybacks because
they would be lending to a company with less risk and they will be able to handle the debt
because of their hedge.
FCF as a sign of value, goes out the window when there is turmoil in markets...
At present, a NEW LOW is around $3 but that will go up but the 200dma is around $6...
So, if we have a severe correction that would be the target. It doesn't mean that it will stay
there for more than a day or so, but markets can be irrational and if SGY can reduce the s/o at
a good price, why not??? Even if it is a few hundred thousand share...
CPG are also doing a buyback, but they are doing it now, as the price goes up. Their problem is
the over hang of Shell's 40 m/s that they got from CPG when they bought their property almost
2 years ago.
At the moment, I can see $117 oil and after that a new high, but I also see $90.
Let's hope that ESGers get more vocal and they live a very very long life.
Oh, by the way, did you hear what Charlie Munger said about US oil, that he would keep US oil
in the ground and buy every drop that he can from the middle east and keep US oil for later...
He described it as precious...
Let's give oil the respect that it deserves!!!
So far, mgnt, good job... But always keep in mind ' what if ??? '...
How many lives has the oil industry used up so far...
Comment by
Baystboy07 on May 06, 2022 6:58am
A NCIB is a much more tax efficient way to return capital.... $SGY is a laggard and where others have exceeded their all time highs $SGY is way below that still.... see the chart below and tell me why they are not doing a NCIB?
Comment by
stocks123ST on May 06, 2022 7:10am
Bayboy I know my missive was long but you should go back and read it again!!! I wrote that I am for reducing the s/o BUTTTTTTTTTTT the purchases should be at NEW LOWS: NOT AT NEW HIGH!!! My math, and it could be wrong, but you buy more when you buy at ' new lows ' rather than buying at ' new highs '...
Comment by
steve957 on May 06, 2022 7:38am
i think the guy is confused lol anyhow sweet dividend, secured captiol program, debt reduction, new land, things are looking good !!!! Share price will be much higher by the time they start share buy backs !!!!
Comment by
Baystboy07 on May 06, 2022 9:00am
SGY is 80% below it's high...LOL...you are truly missing tHe narrative... I am certain the people sitting with an average cost of $2.50 pre-split will love the tax ineffectiveness of the dividend...many are trapped in this stock with an unrealized loss and will now get hit with a tax bill for the dividend... Not an issue for me...as I am up on the stock GLTA
Comment by
stocks123ST on May 06, 2022 9:10am
Bayboy Every time you post you show yourself... The beauty of dividends by Canadian companies is that you get it for almost free!!! The dividend tax credit is manna from your government. A capital gains are less tax effecient than dividends.
Comment by
Baystboy07 on May 06, 2022 9:17am
marginal tax rate in Canada is 39%....capital gains tax is 25% effective...if you have a lower rate than 39% then you are not in the top tax tracker...which I am...get lost dude...the more you post the more ignorant you show yourself...you have been muted now.