GXE's huge torque to $60 oil
Gear's heavy oil has huge torque to higher oil prices and at $60 oil with tighter differentials GXE is spinning of a 40% FCF yield. This FCF gives GXE a stellar balance sheet of 0.5x debt to cash flow. With accelerated growth FCF will increase further setting up 2022 as a monster FCF machine. GXE should start to move much higher like other heavy oil players ATH CJ and MEG. With high insider ownership management team will be more aligned with investors then other names. In Canada the OG sector is coming out of 7 year thaw where pipeline egress is good until 2030(at least) with no need for Keystone XL. Differentials are narrowing and heavy oil is in short supply with two new pipelines coming on in the next two years juicing these heavy oil stocks further. Investor who have missed huge recent moves in this sector can still participate with GXE as $60 oil is the sweetspot for oodles of FCF generation.