Motley Fool article dated July 4 - FYI if not seen alreadyThe current WTI oil price of US$46 and change per barrel is not sustainable for some energy companies. However, others, including
Spartan Energy Corp. (TSX:SPE) and
Torc Oil and Gas Ltd. (TSX:TOG), have adapted to low energy prices. Both small-cap oil and gas producers have strong upside potential if energy prices improve.
Torc Oil and Gas
Torc Oil and Gas grows its reserves, production, and cash flow while keeping costs in mind and maintaining a monthly dividend. In fact, the company has a sustaining capital-reinvestment breakeven WTI price of about US$36 per barrel. Accounting for its dividend, the energy company requires a WTI price of about US$44 per barrel to break even.
At $5.07 per share, Torc Oil and Gas offers a yield of 4.7% and 12-month upside potential of 78% based on Thomson Reuters’s mean target of $9.04 per share. This equates to a total return of about 83% in the near term.
Interestingly enough, the Canadian Pension Plan Investment Board has invested a sizeable stake of about 12% in the company, including the dividends it has been reinvesting.