Tourmaline Oil Corp (Alberta) T.TOU

Replace Special Div. With $1.25 Quarterly Div?

[integrity11]

Not sure if this has been contemplated, but if I were in TOU mgmt. I would seriously consider dropping the special dividend in favour of a considerably increased quarterly dividend. I suggest a $1.25 quarterly dividend or $5 per year. 

I think an increased quarterly dividend would make Tou more attractive than variable special dividends to larger funds and investors. Currently these investors see and value Tou as a 2% dividend corporation which is really not attractive. For small investors I have enjoyed the special dividends for good reason.

I believe the share price is actually held down by the special dividends. Big investors want guaranteed dividends. As it is currently Tou stock goes up until the last trading day before investors no
longer receive the dividend, then proceed to drop by the amount of the dividend.

I believe with a large quarterly dividend announcement the share price will creep to the 70's in a fairly short period of time and with LNG Canada coming onstream in 3rd or 4th quarterly price is more likely to stay up.

Tou can state that in very profitable times a special dividend may still happen.

Welcome your thoughts.

[CriticalMind55]

Committing to a fixed dividend may not always be the best option, before each special dividend, the company considers many available options such as: 1. Acquire another company, 2. Increase capital expenditure, 3. Buy back shares, 4. Pay out higher than expected special dividends, 5. Keep the surplus revenue to compensate for the unhedged portion of their NG and Oil prices, 6. Increase

[7Twiggy]

I would have to agree with CM.  IMO the best bet for the company is to keep all options open. If the regular dividend was too high and the company ran into some cash difficulties a reduction could have a significant downside to the share price.  Always like companies that over deliver rather than those that set the bar too high and under deliver.  Having said that will be really

[1condor]

I would be in the camp of pay a higher and regular dividend. This idea of stating special dividends "are coming" only adds to the volatility of the stock....and this is the last sector that needs more volatility.

[integrity11]

Definitely my opinion Condor. Tou for being what I believe is NA's best NG producing company experiences too much volatility which I think can be significantly reduced by having a steady, reliable great dividend. Sure the share price will still be impacted by weather/natural gas demand but I think will not be affected as much by the shorting practices of hedge funds and large investment corps.

[SadieLadyCO]

Sorry but, I disagree. Look at ENB steady DIVY and still very unpredicable. From $53 to $42 in 12 months. I like the idea of not knowing for sure how much a special divy will be. Maybe more maybe less.

[Lupuslupus]

I like the management gs conservative and prudent approach of returning FCF to shareholders. as was commented on, this leaves the company some options as to capital allocation as needed, and it greatly lowers the chance of the regular dividend having to be cut back or eliminated, which never sits well with investors Mike Rose and his team have been around the block and know how to build and grow

[integrity11]

A $5 annual dividend equates to an 8% dividend for Tou. A $4 annual dividend equates to a 6% dividend. Compared to CNQs annual dividend of approximately 4% I truly believe the large investment companies would be hugely in favour of a guaranteed annual dividend . I don't know what the right % would need to be to ensure Tou will not have to cut dividend rate in the future, but I think 6% would