TLM,CNQ,BAM.a, and more earnings

[selkirk]

well unlike last week Toronto did not drop 6%, only 1.37%, Friday was a big loss. as the base metals, financials, and energy got hit.

here are some earnings from some companies I follow. will include my position

just a note TLM trade on Toronto and New York, though got different PE, however correct estimate.

TLM 17.63 US 18.60 cdn. yield .94%
2006 EPS 1.55 2007 1.11 2008 1.45
produced 450,000 bbd which was down 5% from last year, though they sold some properties.
they will produce in 2007 avg. 465,000 down from 485,000.

delays in tne North Sea, the oil is there but a few months of delay are not uncommon.

2008 production will be in the 530,000-535,000bbd.

the company has bought back 923 million in shares.
TLM has operations in Cdn., US, North Sea, and Asia ie. Indonesia, Vietnam, ect.

have owned the stock for some time.

have 20cdn. sept calls, means have to sell the stock for 20cdn. until the 3rd friday in sept.
recieved 1.80 so on 100shares /1contract =180 dollars.

the whole position has covered calls, on them, time will tell. like the stock just in the short term only see upside to 20-21.

cfs 2006 4.22 2007 4.21 2008 5.38
based on 60US oil. cheap on a cash flow basis very cheap.

if the sept, expire will probably write covered calls 3-4 months out, at 22.

thanks
selkirk

 

[selkirk]

CNQ Cnd. Natural Resources
production increased 5% year over year, Q2 07 produced 614,000 bbd, they should produce 610,000-625,000bbd bbd on average for the rest of 2007.

Horizon oil sand is over 75%, this is great news since costs are rising quickly in the oil sands, and the project will come in 10-15% over budget, this phase. many projects often run 30%+ over budget, shortage of materials and labour.

CNQ has cut in half the amount of natural gas well they drill, focus more on oil. this trend continues as drilling and production in North America will decline..... in time natural gas prices will recover. lower production increasing demand.

reported 2.81cfps however it is closer to 2.64, ahead of the street 2.62 projections.

eps came in at 1.10.
yield .6% small div however most of the money went to develop horizon.

cfps 06 8.80 07 10.60 08 11.74
eps 06 3.10 07 4.07 08 4.40

numbers based on $62 oil.

own a large position and have covered calls on the whole position at 60 cdn. (now trades at 70cnd.).

recieved 3.75 for the calls, not a good trade, though made 20% on the stock in 4 months.

also have 60 cdn. august put, and sold other puts with strikes at 60,62,64. received between 2.50- 3.50 for the puts.

if I lose the position will write more puts and may buy more stock.

believe there is 10-15% more upside in the stock, though it may sit here for a few months.

unlike TLM, has held up better.

thanks
selkirk

 

[lawmaker1]

Curious on your view of OIL the next few years?

 

[selkirk]

lawmaker overall I am bullish on oil. however it is very hard to predict a price even a couple of years out.

back now almost ten year ago, liked an oil compnay, and wrote a covered call. the overall trade would make me 30% in six months....downside was limited or so I thought.

oil was sitting at 18, I remember someone warning me that he read reports oil may fall. so if it fell to 16 did not matter, I mean how low could it go.....

well it went to below 10, know a few people in the industry and some were wiped out. it was brutal.

now should oil have ever been below 10? did not really matter, almost loss 20% on the play. should note stock was bought out and taken private. the money they made off of the trade is incredible.... Gulf Canada. was the stock.

anyways in the short term believe oil/gas could correct, or dead in the next few months.

gas has drifted lower, and probably will continue. inventories are high and if there is no storms price should go lower.... (many companies produce both).

thought oil would trade down to the low 60s however since then it is up around 5 dollars. believe oil will drift lower.

gas should trade at 8 however there is probably more pain in the sector in 07.
as for oil long term prices should be high, most, much of the new oil coming into production cannot be done at 40 oil. and even at 50.

cdn. oil sands is a good example, most projects at 40 do not earn the capital invested. until you reach 60.


BAM.a bam
Broofield asset managment
bam went down on friday 6% after reporting earnngs that missed the street...bad day to miss. still good numbers.

Cash flow from operations for the quarter was .72 /share up from .43 a year ago.

this missed the estimates .84

net income /share .24 up from .20 a year ago for the quarter.

bam is mostly in Commercial real estate...and is not exposed to sub prime...(very small),

their residential operations in Canada and south America offset US weakness.

Bam is spinning off a infasture company, to shareholders....as well keep over 40% for themselves. hydro, timber assets.....will be in the new company....


bam is a good company that ran up maybe to much.....now no one wants it..... one to watch....

note: do not own any, have a small number of puts (in the money) so will own some soon.

also sold uncovered calls against the position.

just a hedge. for the puts I sold.

thanks
selkirk