AssessmentWCP has struggled compared to its large cap competitors such as CNQ and SU. I have a position which is underwater and in your opinion, is it a buy, sell or hold?
SU and CNQ have experienced better total returns in the near term compared to WCP largely due to their aggressive capital returns policies (dividends increases and large share buybacks), while WCP just recently spent capital on a large acquisition (which may take time to reflect into its financials). We think WCP is still a decent-quality energy name that consistently pays monthly dividends. Similar to other energy names, WCP will move with energy prices in the short-term. The shares are cheap, the yield is high, the balance sheet is also solid, and we think WCP should do okay in a better energy price environment. It is also much smaller than the others and in a sector sell off, large companies typically hold up better. (5iResearch)