Last stock in the clip; he also owns it personally. GLTA https://www.bnnbloomberg.ca/video/shows/market-call/2024/08/16/eric-nuttalls-top-picks-tamarack-valley-nuvista-and-arc-resources/ ARC Resources (ARX TSX)
ARC Resources offers deep inventory depth with over 20 years of premium inventory depth and four to five equivalents of their current Attachie development area plus long-term leverage to a secular bull market in natural gas. Trading at 4.5 times EV/CF and returning 70 per cent of post-dividend free cash flow to returns, we see visibility for ongoing trading multiple compression from ongoing, meaningful share buybacks.
TOP PICK
Arc Resources Ltd(ARX-T)
16/08/2024
Defensive way to get into the natural gas sector, which still needs caution.
Very strong condensate production, in addition to gas. Exceptionally conservative management team, proven and tested. Not making a bet on M&A, this as a primary target. Bringing on a big project, have more on the back burner. Discount to US peers, though surpass them on quality and quantity. Yield is 2.6%.
11-14% free cashflow yield. Not as spicy in terms of upside of 30-50% 1-2 years out. Ongoing modest dividend, share buybacks, and production growth.
(Analysts’ price target is $30.90)
Oil / Gas
Eric Nuttall
$25.750
Owned