BEWARE THE STOCK PUMPERS OF MARCH:
EVERYTHING ISN'T AS ROSY AS IT MAY SEEM:
First of all, be wary of recent U.S. stock market gains promoted by the fantasists at CNBC and Bloomberg TV in particular.
It’s just my opinion, BUT:
Don’t be fooled by the current & recent rise in U.S. stock indices.
Professional traders & hedge fund managers are now using computer-generated trading tools to manipulate the market.
No human traders, for these companies, are involved anymore … just robotic computers doing their masters’ bidding.
OH DEAR, NOT THAT:
Ordinary consumer stock-buyers are getting … how can I put it diplomatically … SCREWED!
But as I’ve opined previously, on the "Stockwits" Twitter page ( http://stocktwits.com/MurrayS) , I do believe there is a way to survive & outwait such machinations:
Invest in cash-rich companies that carry no debt, & will pay a (sustainable) dividend no matter which way the markets move.
And so today, here are some of my own choices (in no order of priority):
BEACH ENERGY [$BEPTF] …currently pays no dividend
And please note that this is an OTC (over the counter) purchase, in the U.S., requiring a qualified stock broker
So why buy shares in this international company, based in Australia?
Well for one things, Beach Energy is the second-largest onshore natural gas producer in all of Australia?
And the company’s production is likely to impressively soar in the future.
WHERE DID YOU SAY ALL THAT WAS HAPPENING:
Beach Energy recently drilled 2 new nat-gas test wells in the previously unexplored western edge of Australia's Cooper Basin.
The very good news?
Beach Energy has raised its 2014 production guidance from 8 million to 9.3 million barrels of oil equivalent …
And BOE output was raised from 9.2 million to 9.6 million.
Sorry for the technical terms; but that's what I call "energy speak".
And the translation:
Those are very, very impressive results!
And how do these savvy Aussies do It?
THIS IS FRACKING GOOD NEWS:
Beach Energy has improved its FRACKING technology to exploit previously-unknown massive deposits of nat-gas in the Cooper Basin.
Yes, fracking! The very word that sends outraged environmentalists in a tizzy.
The very thing that America's economically-challenged President won't allow ... even though increased use of this technology could create millions of jobs, as well as reduce unacceptable unemployment rates in the United States.
Excuse the preceding political diatribe ... sponsored by the the Keystone Pipeline.
Well, not really. But you can see that I feel very strongly that Barack Obama is doing a disservice to his nation by finding every way he can to delay expansion of Keystone.
Yes, yes, I admit it. I watch Fox News, and particularly enjoy the "diatribes"of Neil Cavuto & Eric Bolling ("CashinIn") on this subject.
GET ON WITH THE INVESTMENT ADVICE, PLEASE:
So my suggestion regarding Beach Energy?
Consider purchasing shares of Beach Energy [$BEPTF] now…
And be prepared to drill down to soaring increases & capital gains, in the next 3 years.
DON'T STOP READING JUST YET ... THERE'S MORE TO COME:
And now onto two other possible energy-related investments…as we now begin a potentially profitable odyssey through the Canadian stock market.
First, let’s take a look at BELLATRIX EXPLORATION (BXE.CA):
The good news is that shares in Canada’s “junior” energy sector have begun to post impressive gains lately.
Spurring this upwards thrust has been Vermillion Energy’s take-over of Elkhorn, a private resource company.
[For a generous & reliable income stream, as well as future capital gains, I also recommend Vermillion Energy ($VET.CA), currently yielding more than 5%]
And that Eikhorn purchase will dramatically boost Vermillion’s European production, thanks to an addition of many offshore North Sea oil & nat-gas wells…a standard which should help boost Bellatrix's share value, now and in the future.
After all, Vermillion's Elkhorn take-over means sky-high “Brent” (versus American WTI) prices for Vermillion's North Sea oil: up to $115 recently.
As well as soaring prices for nat-gas production, in general, thanks particularly to increased European demand.
And why this soaring Euro demand for energy?
(1) An unusually cold winter in most of Europe this season; and
(2) Uncle Vlad (Putin’s) invasion of the Crimea, and further threats to the Eastern Ukraine
BUT NOW BACK TO BELLATRIX EXPLORATION:
So far, the junior pure energy plays in the U.S. have been hit by worries about more regulatory interference from the Obama administration.
Also in Bellatrix's favor is a lower Canadian dollar which has boosted the appeal of Canadian energy stocks.
After all, nat-gas producers, like Bellatrix, can now hedge out most of 2014 at $4/mcf +…
And the meaning of the preceding tech talk?
Companies like Bellatrix will exceed their cash flow estimates for the first time in 3 years.
Moral of this energy story?
Bellatrix appears undervalued to this observer … considering its production, & profit potential, for the next several years.
ONE MORE ENERGY RECOMMENDATION TO GO:
And now onto another energy favorite of mine: PARAMOUNT ENERGY RESOURCES ($POU.CA), currently yielding 6%.
Paramount could more than TRIPLE its 2014-15 production … from 20,000 boepd to over 60,000 boep!
And, to use an NBA metaphor, this kind of production increase is of Lebron James’ proportions.
And don’t forget that Asian countries – particularly China & Japan – are clamoring to buy Canadian nat-gas & oil…
Not to mention another recent trend:
Government-controlled Asian energy entities are increasingly buying shares of Canadian energy producers ... and sending the share prices of such companies soaring.
And I would take that to be a good omen for the future of Paramount Energy Resources.
HOW ABOUT A CANADIAN INVESTMENT RECOMMENDATION THAT ISN'T RELATED TO ENERGY:
And finally, for a change of pace, let’s look at one non-energy Canadian company:
CANADIAN TIRE ($CTC.A, CDNAF), yielding 1.6%
And please note that in the United States, Canadian Tire is an OTC (Over The Counter) stock, requiring a qualified broker to purchase it.
But why Canadian Tire?
(1) Third-quarter operating earnings ($1.85 a share) were up 15% from last year;
(2) Canadian Tire’s CEO recently announced a 25% increase in the company’s annual dividend to $1.75; and
(3) Candian Tire's earnings are expected to rise further in 2014-15.
And this is partly because of an ingenious idea by company executives.
Canadian Tire has spun off its many company-owned properties into a dividend-paying REIT.
And the cash, generated by that “spin-off”, will be used to expand the company’s current & future operations.
And note too that Canada’s economy is thriving, thanks to the masterful stewardship of Stephen Harper & his finance minister(s).
[Harper makes Barack Obama look like an amateur in this sphere … which, of course, America’s community-organizer President is.]
Again it’s just my personal opinion… But Canadian Tire looks like a very good investment consideration, for capital gains & an increased (sustainable) dividend, in the next several years.
MORE TO COME IN THE COMING WEEKS:
Please stay tuned for more investment advice in the next few weeks, as I get the hang of using my new Web-site software.
Nuff said for today.