RE:G&M Article
Globe says high-yielding Twin Butte seen as safe enough Ticker Symbol: C:TBE
Globe says high-yielding Twin Butte seen as safe enough Twin Butte Energy Ltd (2) (C:TBE)
Shares Issued 344,753,682
Last Close 4/1/2014 $2.23
Wednesday April 02 2014 - In the News
The Globe and Mail reports in its Wednesday edition Franklin Bissett Canadian High Dividend Fund co-lead manager Leslie Lundquist recommends buying Twin Butte Energy ($2.23) for its strong yield and relative safety. The Globe's John Heinzl quotes Ms. Lundquist as saying Twin Butte, which yields 8.6 per cent, is relatively small and so is overlooked by many investors. The oil and gas producer, which is focused on Western Canada, generates enough cash to cover both its dividend and capital expenditures. Production growth "isn't huge. I call it moderate production growth. But really, that's all we're looking for," she says. "They've got a decent balance sheet. We think they've got a realistic outlook on what they have, what it can produce and how it can enrich shareholders." Fund managers who specialize in this area say they want companies that are fundamentally healthy and have a growth element. This is often growth at a reasonable price (GARP) methodology. The process involves calculating a stock's intrinsic value by estimating all future cash flows and then working backward to determine what they are worth today. If the market price is lower than the intrinsic value estimate, the stock is considered cheap.