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Blood in the streets...


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#1 PorkLoin

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Posted 27 June 2008 - 02:50 PM

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Don't know why the plunge occurred.

Good company. Have owned long time. Bought a bunch more today at 8.05, locking in more than a 13% dividend. Electric power trust, not subject to the ups and downs of most energy producers. Stable dividend, so I think, anyway. Company is entirely sheltered from the consequences of the Canadian gov't's decision to tax some trusts as regular corporations, starting in 2011.

Atlantic Power says it doesn't know what's responsible for the big price decline.

Either they're lying and/or some insiders or other large holders are just dumping like crazy, or this is just one of those gifts we see once in a while.

Doug

Edited by PorkLoin, 27 June 2008 - 02:55 PM.


#2 PorkLoin

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Posted 30 June 2008 - 05:05 PM

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And the opposite of "blood running in the streets." I was hoping for a decline to add to positions with respect to oil and natural gas, but it's certainly not happened yet.

The ratio of Oil over Natural Gas has been roughly between 3 and 14 for the past ten years, and we're now at 10.5, so NG could gain quite a lot on oil, there.

On a BTU equivalent basis, NG stands to make up ground on crude as well. Nice, clean-burning natural gas. I' m very bullish on it, despite what may be some bumpy economic times ahead.

One of these days oil is going to manage better than a $10 price decline, but for now the trend is up.


Doug

#3 PorkLoin

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Posted 30 June 2008 - 06:13 PM

When "blood was in the streets" - posted as "Bottom Picking" on the Fearless Forecasters board.

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__________________

June, 2008 - This one worked out:

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By no means is this my favorite, since it's listed on a US exchange and it's been bid way up. Although, the yield is still over 10%, pretty high for Enerplus.

Here are my guys:

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Great management IMO, and a conservative style that should have them weather the storms of market and government.

Peyto yields 8.8%, ARC 10.3%.

Peyto = $2.70 Cdn, cost of production, for each barrel of oil equivalent. ARC = $9.50. ($Cdn. pretty much = $US, Cdn. was 2% over the US today.)

Peyto = 16 years proven reserves, ARC = 10. They're also working to expand this.

Peyto = 83% NG, 17% oil production. ARC = right about 50/50.

They both have roughly a conservative 60% dividend payout.

Peyto = 0% share growth (dilution). ARC = 2.8%. Nice.


I'm not saying rush and buy these. Hoped for a good pullback, like to $19 for Peyto and $26 for ARC, but no dice. Have sold some Enerplus to buy more of these two along the way, and got rid of all the Harvest (HTE - NYSE) and HTE/UN.TO on Toronto (Stockcharts symbols), since though it maintained the big dividend, it has high debt and was underperforming this year.

I still have Provident - PVX - NYSE and PVE/UN.TO - things are looking good there too. It really got whacked in Nov., Dec., and Jan, but has come back and pays 12.4% currently.

And for fun and high dividends:

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Insiders have been buying this one. Yields just over 20% at present, but is only paying out 50% of distributable cash in dividends. The chart looks to me like the market is discounting a dividend cut, but the oil services company (it's not a producer) has set itself up well in the oil sands area. Not one to bet the farm on, but if the dividend doesn't get cut the share should gain handsomely. Even if it does get cut, the shares have fallen already.


Best,

Doug

#4 PorkLoin

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Posted 02 July 2008 - 01:49 PM

:blush: :huh: :( :blush: :stupid: I hadn't noticed that Eveready Income Fund is currently paying dividends "in kind," in other words giving more shares of stock versus paying money. Guess I'm overdue in my diligence. Doug

#5 PorkLoin

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Posted 07 July 2008 - 09:03 PM

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Okay, natural gas was down 4.4% today (nearest futures).

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And oil too had a down day, nearest futures declining 2.7% there.

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Then I see that in the last five trading sessions, ARC from high to low price had a net swing of 16%. Good grief, I say to myself, that's insane. On June 26 it was announced that the dividend was going up, for the second time this year, another 4 cents per share per month, from 24 to 28.

So maybe it's a "sell on the news" type of deal and with a blip down in oil and natural gas prices, combined with a generally-weak stock market (Wilshire 5000 down .87% today), some people just started jumping ship.

Well, that's nuts, but it does make for the best buying opportunities. If we do get a significant decline in energy prices, who knows how far the share price will go down? Can't count on a proportional move, not at all, but to get it at 25.84 would be a 13% yield - outstanding for this company, and a huge gift, IMO. I've seen it happen before with these things.

Let's say the bottom really drops out of oil & NG prices for a while. This ought to clobber the share price. Maybe the dividend has to be cut back, maybe getting rid of both of this year's increases, and the dividend goes back to 20 cents a month, where it was in December and January. If the share price gets back to 19, it's still a great buy in that event - it was yielding 12.6% under those conditions and again - you don't see that much with a high-quality deal like ARC.

So, buying on spike lows is good with these beasts, and at "panic" lows - which we see probably every three months on average - is great.

#6 mss

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Posted 08 July 2008 - 10:07 AM

:o Hold on to your hat bottom coming up fast.

http://stockcharts.c...5943&r=4134.png
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#7 PorkLoin

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Posted 15 July 2008 - 09:12 AM

MSS, yeah - and it's funny, Natural Gas goes sideways for three trading sessions after the move down from the early July high, and some of the stocks jump back up like crazy. Just shows you how emotion goes from one extreme to the other in the marketplace.

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ARC Energy is one of the better companies in one of the better industries. You get a panic, good time to buy.


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ARC may have bounced back already, but here's one that's had a big slump and in my opinion is too good to pass up.

I've mentioned it before, and electric power trusts are less volatile (usually) than oil & gas companies. The blood is definitely "running in the streets here," and I think it's way overblown. I see now that it's traded down to 6.51 today, and that's over a 16% yield. I think it's August 13 that the latest financial results are going to be let loose, and while it can be said that "the market knows best," in this case I think fear (from what I really don't know) has gotten the better of people.


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For an oil & gas producer, in this case 5/6 of production is natural gas, I think Peyto is a screaming buy right here too.

#8 PorkLoin

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Posted 25 July 2008 - 01:46 PM

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Bounced back - still don't know what accounted for the plunge. Yielded almost 17% at last week's low, now 12+ % after today's rally.