RE:RE:Eric Nuttall on PEY - BNN Market CallWe all want more Peyto.
I think everyone is a little off on where Peyto is headed and what they have done in the past.
Natural gas prices aka US shale etc and egress issues have been the most traumatizing for PEY for several years now.
To shore up things and make sure they had money coming in, they hedged, albeit the hedging market was not as good then either so they got caught.
If prices were still only $2.00 to $2.50 I don't think anyone would be complaining about Peyto's hedges. It is only because prices exceeded $4 and up.
This is similar to owning a bank stock, selling covered calls and getting the stock taken away, you played it safe, made a profit but it ran away.
Fortunately for PEYTO and others they don't lose their lands, people or production, they live to play another day.
If anything PEY is set for a major improvement in the next six months, 12 months 3 years and onward.
As long as prices stay above $4 or $5 they are going to keep doing very well, more land, more plants, more production. It is hard to say whether they can do better than several other firms. Other firms take huge risks and sometimes win and sometimes lose.
I just don't ever want to see PEY and others have all their shares go to a $1 ever again. It is not good for the companies, not good for employees, not good for government revenues.
This time around as PEY pays down debt I am doing so also. Every inch of improvement over the next 18 months I plan on setting a small amount aside just in case something comes out of the blue.
Major war, continuing covid in China to keep a lid on their people. I am not sure they want their people to do as well as in the past, harder to control. Possible political constraints so onerous that it will be a major setback for all oil and gas companies.
At least with 11 cents dividend coming I can feel more at ease owning a larger position while waiting for the price to rise to the levels it should be at longer term and not 2X EV.