WHITECAP RESOURCES - Strong buy Whitecap is still a strong buy and the only change from a few weeks ago when it hit 8 dollars is it has a few more weeks of oil over 80 and gas above 5 dollars locked in. Minus hedging differentials . To me being a businessman - person , we always say ......... you are only as good as your last month . We get reports every quarter! So your only as good as your last quarter . 3 months per Quarter and we have one plus months locked in at strong pricing .
If I am not mistaken we are coming out of shoulder season. To me .....this means I don't need to turn on the AC during the day , and I don't need heat at night or vice - verca , plus there generally is maintence work being done . It's a sweet spot for less energy consumption.
So a great analogy for this would be how low the water levels got this summer in British Columbia we had a massive record setting heat wave and the water levels were drawn down . It got scary , but we know fall is coming and it rains. The water rises , and we end up with flooding , depression. Lol , and we get the water built up. Well , with oil we didn't have record consumption, we had man made curtailments in production globally , and levels dropped. Shoulder season is here ( rainy ) but the production isn't filing up the resovoirs . In-fact some resovoirs or energy supply dried up , causing a switch to other types of energy ( diesel ) and we had a run up in pricing . So now we have had a few weeks of small build ups and things have settled down . ( pull backs - profit taking )
Well , shoulder season is ending , it's going to get cold , and we haven't filled up the lakes , and resevours ( Cushing , Europe's gas storage ext. )
A SNEEZE from what I see will cause a draw down , any type of cold weather front is going to increase consumption , and on top of that AIR TRAVEL albeit slowly is beginning to pick up again .
What is my point ? Eric Nutall sold some shares , he took some profit , ISNT that what most people were saying to do ? I think he made a text book move. You always have to remember he has his own agenda , but his assumptions or thesis about energy , the sector , and about Whitecap are accurate ! I think that these analysts have some value , and they bring things to my attention I might not of known otherwise.
BUT ..........you have to be reresponsible for your own decisions. The only person that has a right to complain to Eric or about Eric is the person Who owns 9 point energy fund or whatever they call it.
I like all the opinions here , and yes it does bug me that he was talking it up , and then sold some. However , I also think it was smart. Further to that ! If it did really bother you , than it's a learning curve , you will never put the weight into his comments again like you did before.
Here's the thing , if you are long WhiteCap or you have a target price . Then none of this should matter, because
in about 4 to 6 weeks oil will likely still be at this price or
higher , with cold snaps bringing higher energy consumption, people flying out of here to warmer places .
Things are strong !
Finally , I want to ask if Goldman or anyone else came out and said they changed there mind on 90 or even 100 dollar oil ? No !! In fact it's only been reiterated many times.
I say this now and then that I own WCP , so don't listen to me. When you watch BNN, they use to put on the screen while the analyst was talking about a stock if they owned it ? I am sure they still do. So next time
you see that , change it to " don't listen to me .....I own it " and this will remind you to stick to the real facts. Those facts are good ........ Oil 82 dollars ......gas above 5 dollars. Shoulder season is ending. Consumption is going to rise !
Pay attention to the balance sheet , the income statement . Whitecaps Is first rate !! Then the messaging witch really only has weight based on weather they have a track history of doing what they say they are going to do. Even then , you should use caution.
None of that changed because Eric Nuttall sold shares.
1) BALANCE SHEET - could be debt free in one year
2) INCOME STATEMENT - making 495 M discretionary cash flow at 65 dollar oil.
3) MESSAGING -
a) will pay 50 % back to shareholders all discretionary funds flow
b) Carbon Capture - government is going to start charging a minamum for Carbon , we not only are a negative emitter , meaning tax credit Potential, we are able to create revenues from excess storage capability, and the kicker for upside is this CARBON storage creates PRESURE IN THE HOLE , and this helps produce
even more oil.
In the spirit of full disclosure, I own a fair amount of this stock and I am long , however...... I have a target price with a expiry date at witch i would sell my shares , and start looking for something else. That could be many things , not all stocks either , and could even
be buying back in again later.
So I am no better than Eric as I am also pumping this stock , but I would like to think I am only stating facts , and making sure you remember to draw your own conclusion, and to be reresponsible for your choices
Nothing has changed - bright side divvy is coming on the 15th , more shares repurchased under 8 dollars likely . This is really good !
Train is still on the track !
C