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Enerplus Corporation Message Board

  • michelle314us michelle314us Jan 17, 2013 11:39 AM Flag

    Oil above $90 and gas above $3, ERF should really be above $20

    I guess a lot of investors are "traumatized" by the 50% div. cut. we had (due to gas dropping below $2 and to some extent oil dropping below $80).

    If these levels maintain, I see no reason why they wouldn't return the div. back. I'm accumulating at these ridiculously low prices.

    Also, with Transcanada building the new pipeline, we will be exporting to Japan/China in a couple of years, at maybe double the current prices we're getting from the yanks (who have their own gas).

    I wouldn't be surprised at all to see my ERF at $50/share by 2015.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • I think that Transcanada is the best bet, then. They'll make money regardless of who's producing the oil.

    • Your January 31st post(yesterday at 12:45pm) about the Obama Admin and anti Canadian Oil etc is perhaps the best post I have seen on this message board and most of us south of the Canadian border with any love of our country are in total aggreement with you. Great Post! Don't know why it did not allow the option to reply. Hopefully ERF will be good to us when the Arabs start start blowing things up it the middle east. It's sad, but it is coming sooner than we think.

    • "I see no reason why they wouldn't return the div. back."
      Have you looked at what their profit is that can pay out a dividend. I don't think they can cover their existing one as it is.

      • 2 Replies to rhianni
      • Agreed, the next change in dividend is far more likely to be another cut than a raise, imo.
        Not saying it will happen this year, although that's possible too.

      • Remember two things:
        1. The published earnings reflect the past. Not the future, and not even the present.
        2. For an oil exploration and production business like ERF, "earnings" include
        a lot of depletion/depreciation (good for not paying taxes). For dividend
        coverage, look at what the accountants call "cash flow", or even EBITA
        I prefer cash flow. As long as "earnings" are low, we don't get double taxation
        on our dividends.

        Waiting year or two is nothing. Remember, we're still getting , what is it, 6 or 7 percent div. while we "hold our breath" ?

        As for the head prices being lower than the U.S. Henry Hub or WTI, it is true. But that's why I pointed out that Transcanada is working RIGHT NOW on connecting us with Asian customers who pay two to three times the prices that our friends to the South (temporarily crippled by a really bad president) pay.

        Yes, the market will go up and down daily to confuse, and maybe even scare, us. But we know that in the end, we will win, big time. Can the civilized world function without its easy to use energy ? Is it not a given that the usual nutjobs in the Middle East will do something destructive, and the world will need OUR energy more than ever ?

        Don't be fooled by big hedge funds / banks / sovereign funds who all covet our proven reserves as well as daily production. They want you to sell at these low prices.

    • Who cares if oil is $90 at Henry Hub. It isn't at $90 where ERF produces its oil.
      And where are the much higher drilling costs compared to years past factored into this 'analysis'.
      Product prices are only one half of the equation.

    • I LOVE YOUR POSITIVE ATTITUDE! Want hold my breath, but hope you are right and hope I have the guts to wait that long if it does return to the "Glory Days." Fun to Dream.

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