Three Oil & Gas Trusts for Steady Gains

Article Excerpt

ARC ENERGY TRUST $24.39 (Toronto symbol AET.UN; SI Rating: Speculative) produces oil and gas in western Canada. In the three months ended December 31, 2007, ARC’s revenue rose 15.6%, to $338 million from $292.5 million. Cash flow per unit rose 6.5%, to $0.82 from $0.77. The rise in cash flow came largely from higher oil prices. ARC’s average daily production of 63,989 barrels of oil per day equivalent is weighted 51% toward oil and 49% natural gas. In the latest quarter, its average realized price for oil was $77.53 U.S., up 33.1% from $58.26 a year earlier. Natural gas was $6.32 U.S., down 1% from $6.99. ARC’s debt remains low, at approximately 14% of market cap or under one year’s annual cash flow. ARC pays a monthly distribution of $0.20, for a current yield of 9.8%. It distributed 70% of its cash flow as distributions in the latest quarter. ARC Energy Trust is still a buy. PENGROWTH ENERGY TRUST $18.60 (Toronto symbol PGF.UN; SI Rating: Average)…