RE: Running with a winner! More on why am I comfortable doing this?
BMO has a target of $18, RBC $20. I remember when BMO and RBC were rating IPL.UN $8.00 sector perform and we had just printed $9.50. Way to go out on a limb on those calls guys!
My conclusion was that the eastern based bank analysts just didn't understand the pipeline business. Now the pipeline business that I own, IPL.UN and PPL are not that hard to understand, so my further conclusion was that these guys don't truly understand the oil and gas business. They are more comfortable understanding the banks, Weston and Manulife etc. yawn . . . Yet they are offering a premium valuation on a new venture and in my experience, they guess low, after the target has been blown away low.
Macquarrie has a $25 target and this Aussie bank understands the resource sector. Global Hunter securities (never herd of them) just chirped in with a buy recommendation.
The ability to sell options against PSN is gravy. The trading volatility has kept option premiums quite high. If my Mar17 calls expire wotthless tomorrow, I can start looking at selling March 17's for $.30 or April18's for $.20 at THESE trading levels.
A couple of months option premiums, a couple of months divys and a CG on take out. This is the stuff that can add to your returns. This trade is an overweight position to take advantage of the high option premiums and it is not often mr. market hands you nearly free money!
GLTAL
SS