Enerplus Resources Fund $26.42 – Toronto symbol ERF.UN

ENERPLUS RESOURCES FUND $26.42 (Toronto symbol ERF.UN; Shares outstanding: 165.3 million; Market cap: $4.4 billion; SI Rating: Speculative) is one of North America’s largest oil and gas trusts. Production is currently weighted 60% toward natural gas and 40% to oil. Enerplus continues to focus on building a well diversified portfolio balanced between low-risk, shorter- term assets that generate steady cash flow such as conventional oil and gas and shallow gas properties, and higher-risk, longer-term assets including tight gas and oil sands. Enerplus’ long-term debt of $522.8 million is low at 11% of market cap. To conserve cash, Enerplus lowered its quarterly distribution with the January, 2009 payment by 34.2%, to $0.25 from $0.38. It now yields 11.4%. Enerplus’s cash flow for 2009 is forecast at $4.80 a share. The trust trades at 5.5 times that estimate. Enerplus Resources Fund is a buy.

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Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.

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Dividend stocks make cash payouts that serve as a way for companies to share the wealth they’ve accumulated. These payouts are drawn from earnings and cash flow and paid to the shareholders of the company. Typically, these dividends are paid quarterly, although they may be paid annually or even monthly as well.

Value Stocks

What are value stocks?

One of the sweetest and most profitable pleasures of successful investing is to buy high-quality “value stocks” (or stocks that are reasonably priced, if not cheap, in relation to its sales, earnings or assets), then hold on to them as mainstream investors recognize the value and push up the share price.

Growth Stocks

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What are energy stocks?

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