Surge Energy Inc (Alberta) T.SGY

Debt is Good! Sgy can make way more money with debt!

[Tanman1914]

People don't seem to understand that debt is good. Sgy can make way more profit then the small interest rate they are paying for debt! DEBT IS GOOD! Unless you think oil is going to $40 or less then debt is bad but if you think that is the case then why are you investing in the oil sector??? WE ARE IN A MULTI YEAR BULL CYLCLE FOR OIL. Cycles usually last 5 years... the last bear cycle lasted about 7 years... it just means this bull cycle will last longer then 5 years! Smart management knows this and they are acting accordingly even if there are some investors who don't have a clue about the oil cycle and investing in oil. I'm glad SGY management is not listening to the trolls on here and are doing what is best for the company and shareholders. Even if some shareholders don't get it. Talk to me in a year or even 2 years and you will see that SGY is making smart moves! 

I give you an example: lots of guys on here were pissed off that Paul bought Astra and Firesky... they called him a gambler... what do you have to say now?! Paul and his team are smart investors and smart management. Fear makes people go back when they should go forward. Paul and his team made amazing moves and they continue too. They understand the generational opportunity in front of them when many don't get it. 

Thx
Tanman

[Binkie]

Thanks Tanman, perhaps you're right that debt is good under these circumstances with a bull oil cycle, leverage I believe they refer to it as. My concern is that if the cycle is 4 and not 7 years and we get caught with debt that becomes unmanageable....This could  be a super bull cycle with these prices, but these are tumultuous times, which creates uncertainty and unpredictability

[Tanman1914]

Thank you Blinkie for your thoughts. Yes it depends on Investor preference. I see it as a good thing and I'm sure they pay the debt off little by little. I don't see it as an urgent need to drastically lower debt but yes as you said everyone's preference is different. If they use the debt to increase production a bit then they can pay off debt faster at these prices. I'm sure Paul

[Tanman1914]

I also wanted to add. I don't find it too risky. Oil companies are still not investing very much into production growth at all, demand continues to grow, opec is almost out of spare capacity. Oil companies are giving money back to shareholders rather then investing in substantial production.. so supply continues to draw down.  Let's say Oil companies changed their tune and decided

[Kherson]

[Kontrary]

Debt is only good when it can be used to generate opportunities that will produce revenues well in excess of the cost of the debt. It is also only good when it is kept at levels that do not impede management's abilities to make the best decisions for the business.  We are less than two years away from a time when many of the companies that are currently spinning out great profits almost

[llerrad5]

Over the two years you can bet that the debt will go down. The lender would not allow them to pay a dividend if they chose to prohibit it.