Are any of you investing in energy or base metal stocks these days? If your stocks are up 40% in the last four months, you are still probably underperforming the energy indexes.
what up ali. if you’re in canada, you better be in metals and energy. did you touch any OPC as it fell off a cliff?
Nope - I cover it. It was fun to write a report with a 0 target price 
How have you been?
haha. you’re on the RBC team eh? you would have lost me a bunch of dough with that report of yours if OPC hadn’t recovered so strongly off of $0.19… I had to have a taste of OPC as it felt like another NOVA at the time (enormous debt, no cash, plummeting on minimal news). I’ve been good. You know me, slangin my metals, but i’ve been getting seriously interested in the energy space as of late. its the only attractive, high beta sector at this point. i’m still in KW. are you still in Calgary? if i remember correctly…
I am curious about what you mean by “high beta sector”.
^ more volatile sector than the market on average?
Thanks, but what I’m interested in is what MLA means by it.
Captain Windjammer Wrote: ------------------------------------------------------- > Thanks, but what I’m interested in is what MLA > means by it. ouch.
MattLikesAnalysis Wrote: ------------------------------------------------------- > haha. you’re on the RBC team eh? you would have > lost me a bunch of dough with that report of yours > if OPC hadn’t recovered so strongly off of > $0.19… I had to have a taste of OPC as it felt > like another NOVA at the time (enormous debt, no > cash, plummeting on minimal news). > > I’ve been good. You know me, slangin my metals, > but i’ve been getting seriously interested in the > energy space as of late. its the only attractive, > high beta sector at this point. i’m still in KW. > are you still in Calgary? if i remember > correctly… Sorry to break your bubble but TheAliMan is not with RBC.
Captain Windjammer Wrote: ------------------------------------------------------- > Thanks, but what I’m interested in is what MLA > means by it. look at the beta for all energy companies. even the large caps are ~1.5… now compare to a low beta sector. for example, utilities, is closer to 0.6 on average… pretty standard. don’t know why you wanted me to explain.
Iginla2010 Wrote: ------------------------------------------------------- > MattLikesAnalysis Wrote: > -------------------------------------------------- > ----- > > haha. you’re on the RBC team eh? you would have > > lost me a bunch of dough with that report of > yours > > if OPC hadn’t recovered so strongly off of > > $0.19… I had to have a taste of OPC as it > felt > > like another NOVA at the time (enormous debt, > no > > cash, plummeting on minimal news). > > > > I’ve been good. You know me, slangin my metals, > > but i’ve been getting seriously interested in > the > > energy space as of late. its the only > attractive, > > high beta sector at this point. i’m still in > KW. > > are you still in Calgary? if i remember > > correctly… > > Sorry to break your bubble but TheAliMan is not > with RBC. weird. i guess there was a another report on OPC with a target price of zero that i missed…
MattLikesAnalysis Wrote: ------------------------------------------------------- > Captain Windjammer Wrote: > -------------------------------------------------- > ----- > > Thanks, but what I’m interested in is what MLA > > means by it. > > look at the beta for all energy companies. even > the large caps are ~1.5… > > now compare to a low beta sector. for example, > utilities, is closer to 0.6 on average… > > pretty standard. don’t know why you wanted me to > explain. Thanks. Is that what makes it attractive in your view (as you mentioned in your original post), or is it attractive for other reasons? Just trying to understand your analysis.
I’m tempted to sell my entire energy portfolio at these levels. I think valuations are becoming unreasonable even assuming a bullish outlook.
Captain Windjammer Wrote: ------------------------------------------------------- > MattLikesAnalysis Wrote: > -------------------------------------------------- > ----- > > Captain Windjammer Wrote: > > > -------------------------------------------------- > > > ----- > > > Thanks, but what I’m interested in is what > MLA > > > means by it. > > > > look at the beta for all energy companies. even > > the large caps are ~1.5… > > > > now compare to a low beta sector. for example, > > utilities, is closer to 0.6 on average… > > > > pretty standard. don’t know why you wanted me > to > > explain. > > Thanks. Is that what makes it attractive in your > view (as you mentioned in your original post), or > is it attractive for other reasons? Just trying > to understand your analysis. if you think the market will appreciate you generally want to be in a high beta sector. so if you’re investing $1 in the market, you want to pick your favourite high beta sector, elsewise, exit equities. well yeah. as i said, of the high beta sectors (energy, materials, and to a lesser extent, heavy industrials) energy requires the least improvement in the economic environment and related commodity prices to move forward as a group. I’m sure you could find plenty of others who think energy is stupid right now and that you should be in copper because the bull is just getting started, blah blah blah. i’m a value investor so my recs are deep-rootedly value oriented. looking at small cap and distressed energy, which haven’t reacted to a $10 spike in oil prices and possible future on natural gas prices (LNG export reduction, the adage of rising oil = rising nat gas), they are especially attractive. compare junior o&g to junior metals. entering junior metals at this point is scary. all metals stocks are currently trading at maybe 10x downside underlying commodity volatility and maybe 2-5x upside underlying commodity volatility. for example, look at silver and how any silver company has reacted to silver making new highs. then do the same for copper and see how southern copper or first quantum or candente have reacted to slight drops in the copper price, but barely reacted to the last $0.60 of gains in copper. from my view, junior o&g is already at rock bottom in terms of valuation, especially if you have any gas on the books. junior o&g stocks don’t even react to commodity prices anymore, that’s how bad the sentiment is… that said, i’m no energy analyst nor am i a mining and metals analyst. i’m just a guy who has vast research at my fingertips, who watches them metals and energy stocks all day and comments on them in client-friendly language.