Husky Energy Inc. cumulative redeemable preferred T.HSE.PR.B

Street- Dramatic Change in Opinion

[Dogsbreakfast4U]

Below is what TD was saying about Husky in the Spring of 2015. Oil was trading in the mid $50 at the time. The stock was trading at $25.85 and they had a $34 12 months target price. The latest note (27 Oct) from TD states that at $16 the stock is fairly valued. They now have a $17 price target.

When the stock was trading at  7.9 X 2015 EV/DAFC and a P/NAV of 74% it was deemed <<too inexpensive to ignore>>.HSE now trades at 6.0 x 2017 EV/DAFC and a price to NAV still well below a 100%

Now you tell me why the stock target price was sliced in half and with similar metrics is no longer too cheap to ignore at $16!!

I could not stop laughing when I read <<very low risk of a dividend cut>>. 

<<TD Action List 2015

Husky Energy Inc. HSE-T: $25.85; 12-Month Target: $34.00 Menno Hulshof, 403 292 8658 We added HSE to the Action List in December 2014. It remains well positioned to ride out further weakness in oil prices given a pristine balance sheet, low sustaining capital requirements, and a very low risk of a dividend cut, in our view. In addition, the mega-project development risk has largely been taken out of the story with Liwan now producing and first oil achieved at Sunrise in March. While broadly considered one of the more defensive energy names, we note that HSE was the worst-performing integrated in 2014 after Cenovus Energy Inc. (CVE-T), having fallen 18%. This was on par with the iShares S&P/TSX Capped Energy Index ETF (XEG-T). With the stock now trading at only 7.9x 2015E EV/DACF and a P/NAV of 74%, it is simply too inexpensive to ignore, in our view.>>