Peyto Exploration & Development Corp T.PEY

Thinking more about RE:$100 million annual dividend

[BSdetector2016]

This could be an attempt to goose SP so all those options are worth something. Focus should be on debt. When the debt is down to a manageable amount SP will benefit, and then a dividend boost will be justified.

[Burgersandfries]

It's hefty increase they are clearly confident as am I that debt can be delt with later as long as they do it that's the main thing. High gas and oil prices  or well above average are here for a few years. The drop in their hedges or hedging at these higher prices gives them the option to deal with debt later. Gifting their shareholders a little later is ok with me.

[llerrad5]

Having personally dealt with large lenders you can be certain that the div. increase has met with thier approval. The loan agreements are extensive and doing business with an unhappy lender would made PEY life untenable.

[houbahop]

Higher leverage means higher volatility for the shareholders. This increase in shares volatility gives management the opportunity to give themselves options on the shares at a very low price. They served themselves pretty nicely in the last downward cycle which brought the shares to under $1, thanks to higher probability of bankruptcy because of the huge debt relative to EBITDA. There are now 10

[houbahop]

My last comments were quite harsh and a remnant of the recent past. The other side of the coin is Peyto's team are working hard and have positioned the business to be very lucrative to all the actors around its activities, shareholders included. :)

[CashGreenGold]

Good to see both sides... ..but i wouldn't blame PEY mgmt for the low share price in 2020 ...-$37 wti and 1xx NG had something to do with it

[topdop]

Totally agree. Of course a Pandemic was not their fault. The Fiduciaries & BoD did what they needed to do to save the Company. And that includes the Hedging strategy (which BTW, could also just as easily have gone the other way...). To throw rocks at them now, after the fact, and for rewarding Management with Options, smacks a little bit of sour grapes. If you don't like the renumeration

[houbahop]

"The Fiduciaries & BoD did what they needed to do to save the Company." I guess you missed my point here. The BoD decision to borrow money to pay a dividend for so many years had weakened its capital structure, making Peyto vulnerable to a macro event. The macro event(s) happened and the stock plummeted to $1. This kind of behaviour does not attract long term investors but I'

[itsalie]

 Not sure why you hold the stock then, lots of better opportunities out there. Why hang around dead money.