Energy Stocks 10X (March 5, 2019) Trading the Black Gold

Scott Willis and Johnny Mastromattei talk oil market trading strategies, give their opinion on oil markets and run through three oil stocks worth a look in the debut edition of Energy Stocks 10X (March 5, 2019) Trading the Black Gold.

Stock Picks

Prairie Provident Resources [stock_market_widget type="inline" template="generic" color="default" assets="PPR.TO" markup="(TSE: {symbol} {currency_symbol}{price} ({change_pct}))" api="yf"]

Thesis: Stock has a very interesting non-oil related catalyst coming soon. Results of a NAFTA lawsuit against the U.S. government will conclude in the next few weeks. A positive outcome could add $0.15/sh of cash to a company trading for only $0.21/sh.

Prairie Provident 1 Year Stock Price - Mar 2019
Source: Yahoo Finance

Essential Energy Services [stock_market_widget type="inline" template="generic" color="default" assets="ESN.TO" markup="(TSE: {symbol} {currency_symbol}{price} ({change_pct}))" api="yf"]

Thesis: Stock trades for $0.30/sh but has working capital net of debt worth $0.25/sh, making this a deep value play on a Canadian oil recovery.

Essential Energy Services 1 Year Stock Price - Mar 2019
Source: Yahoo Finance

Parsley Energy [stock_market_widget type="inline" template="generic" color="default" assets="PE" markup="(NYSE: {symbol} {currency_symbol}{price} ({change_pct}))" api="yf"]

Thesis: Great rocks in the Permian give the company solid growth potential in production and cashflow per share. Most importantly, the stock has net debt to EBITDA of only 1.5x, very conservative compared to many names at 3x-4x. The strong balance sheet will allow Parsley to weather the storm should oil prices go lower while the company continues to drill and grow, making them a target for a larger producer who wants exposure to the Permian.

No Debt Due Anytime Soon.

Source: Parsley Q4 2018 Earnings Presentation

The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.

Capital 10X gets down to the real money business, actionable financial insights for traders and investors. We analyze company earnings, interview management teams and help teach the fundamentals of financial analysis and options trading. Our mission is to hunt for genuine 10 baggers.



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