oil prices

TUPPERWARE BRANDS CORP. $62 (New York symbol TUP; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 57.4 million; Market cap: $3.6 billion; Price-to-sales ratio: 1.3; Dividend yield: 1.9%; TSINetwork Rating: Above Average; www.tupperwarebrands.com) was our Stock of the Year for 2011. Like IBM, Tupperware continues to see strong demand for its products, particularly in fast-growing countries like Brazil, Indonesia and Turkey. These markets now supply 63% of the company’s sales. Also like IBM, Tupperware continues to aggressively repurchase its shares. Buybacks raise earnings per share and other per-share calculations, and give the remaining shareholders a larger stake in the company....

SHERRITT INTERNATIONAL $6.36 (Toronto symbol S; TSINetwork Rating: Speculative) (1-800-704-6698; www.sherritt.com; Shares outstanding: 296.4 million; Market cap: $1.9 billion; Dividend yield: 2.4%) is a diversified natural-resource company that produces nickel, cobalt, thermal coal, oil and gas. It also manages 376 megawatts of power-generation capacity in Cuba. Sherritt is a major nickel producer, with operations in Cuba and Canada. It is also close to finishing a mine at its 40%-owned Ambatovy project on the island nation of Madagascar, off Africa’s east coast. As well, Sherritt produces oil and gas in Cuba, Spain and Pakistan. It is also Canada’s largest thermal coal producer. In the three months ended September 30, 2011, Sherritt’s earnings jumped 102.2%, to $45.5 million, or $0.15 a share. A year earlier, it earned $22.5 million, or $0.07 a share. Revenue rose 13.0%, to $466.4 million from $412.7 million. Higher coal and oil prices were the main reasons for the improved results....

SHERRITT INTERNATIONAL $6.36 (Toronto symbol S; TSINetwork Rating: Speculative) (1-800-704-6698; www.sherritt.com; Shares outstanding: 296.4 million; Market cap: $1.9 billion; Dividend yield: 2.4%) is a diversified natural-resource company that produces nickel, cobalt, thermal coal, oil and gas. It also manages 376 megawatts of power-generation capacity in Cuba.

Sherritt is a major nickel producer, with operations in Cuba and Canada. It is also close to finishing a mine at its 40%-owned Ambatovy project on the island nation of Madagascar, off Africa’s east coast. As well, Sherritt produces oil and gas in Cuba, Spain and Pakistan. It is also Canada’s largest thermal coal producer.

In the three months ended September 30, 2011, Sherritt’s earnings jumped 102.2%, to $45.5 million, or $0.15 a share. A year earlier, it earned $22.5 million, or $0.07 a share. Revenue rose 13.0%, to $466.4 million from $412.7 million. Higher coal and oil prices were the main reasons for the improved results.

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Recovering global economies should boost oil and natural gas prices—although rising oil sands and shale gas production could hold back those increases. Imperial Oil’s large oil and gas reserves should last for decades. But the company also owns four refineries and operates 1,850 Esso gas stations. This diversification helps shield Imperial from volatile oil and gas prices and further cuts its risk. IMPERIAL OIL $46.03 (Toronto symbol IMO; Shares outstanding: 850.5 million; Market cap: $39.1 billion; TSINetwork Rating: Average; Dividend yield: 1.0%; www.imperialoil.ca) is a major integrated-oil company that gets most of its production from its oil sands projects in Alberta. Imperial also has conventional oil and natural-gas operations in western Canada, and it holds interests in offshore projects in Atlantic Canada. In the three months ended September 30, 2011, Imperial’s earnings jumped 105.5%, to $859 million, or $1.01 a share. A year earlier, it earned $418 million, or $0.49 a share. Imperial increased its oil sands production and benefited from rising oil prices and improved refinery profits. Revenue rose 35.8%, to $7.9 billion from $5.9 billion....

ARC RESOURCES $25.52 (Toronto symbol ARX; Shares outstanding: 287.6 million; Market cap: $7.3 billion; TSINetwork Rating: Speculative; Dividend yield: 4.7%; www.arcresources.com) produces oil and gas in western Canada. Its average daily production of 85,178 barrels of oil equivalent is weighted 67% to gas and 33% to oil. In the three months ended September 30, 2011, ARC’s cash flow per share rose 17.5%, to $0.74 from $0.63. That’s because the company raised its production. It also benefited from higher oil prices. ARC converted from a trust to a corporation on January 1, 2011, in response to Ottawa’s income-trust tax. However, ARC has $2.2 billion of tax pools that are letting it offset the tax and maintain its $0.10 monthly payout (it now yields 4.7%)....

CENOVUS ENERGY $34.33 (Toronto symbol CVE; Shares outstanding: 757.8 million; Market cap: $26.0 billion; TSINetwork Rating: Extra Risk; Dividend yield: 2.3%; www.cenovus.com) reported that its cash flow per share rose 54.4% in the third quarter of 2011, to $1.05 from $0.68 a year earlier. A 9.6% increase in oil prices was the main reason for the gain. Cenovus continues to expand its Foster Creek and Christina Lake oil sands operations in Alberta. U.S.-based ConocoPhillips owns 50% of these properties. The company now plans to spend between $3.1 billion and $3.4 billion on these and other projects in 2012. That’s up 23% from its 2011 capital expenditures. These investments will push up Cenovus’s production to between 155,000 and 171,000 barrels of oil equivalent per day (including natural gas), from 135,000 barrels in 2011....

Equal Energy, $4.74, symbol EQU on Toronto (Shares outstanding: 34.7 million; Market cap: $164.5 million; www.equalenergy.ca), is based in Calgary but has an office in Oklahoma City. Equal has producing oil and gas properties that are mainly located in Oklahoma, Alberta, B.C. and Saskatchewan. The company’s production is 52% oil and 48% natural gas. In the three months ended September 30, 2011, Equal’s cash flow was $0.50 a share. That’s up 19.0% from $0.42 a share a year earlier. The gain was mainly the result of higher oil prices and production. During the quarter, the company produced an average of 11,263 barrels of oil equivalent (including natural gas) per day, up 28.3% from 8,777 barrels a year earlier....

CENOVUS ENERGY INC. $34 (www.cenovus.com) reported that its cash flow per share rose 54.4% in the third quarter of 2011, to $1.05 from $0.68 a year earlier. A 9.6% increase in oil prices was the main reason for the gain....

Inter Pipeline Fund, $18.75, symbol IPL.UN on Toronto (Units outstanding: 264.1 million; Market cap: $5.0 billion; www.interpipelinefund.com), transports, stores, markets and processes oil and natural gas. The fund has three divisions: pipelines transports 35% of Canadian oil sands production and 15% of western Canadian conventional crude oil; extraction processes 40% of Alberta’s exported natural gas into natural gas liquids; and the storage division, which operates under the Simon Storage and TLG banners. In the three months ended September 30, 2011, Inter Pipeline’s revenue rose 30.4%, to $302.1 million from $231.7 million a year earlier. Cash flow per unit jumped 43.3%, to $0.43 from $0.30. That’s mainly because the company’s pipelines shipped 993,300 barrels a day in the quarter, up 24.6% from 797,300 barrels a year earlier. The increased volumes came mostly from a $1.8-billion expansion of the fund’s Corridor pipeline, which was completed in January 2011....

Yesterday we discussed the shale revolution. (View the post: Why the shale revolution will make oil price shocks a thing of the past.) The production of natural gas and oil from shale is rising rapidly in North America. This angers some environmentalists, even as it creates jobs and tax revenues at a time of economic uncertainty. More than that, oil production from shale – which will contribute much more to oil reserves than most people realize – is due to alter the balance of supply and demand in international energy. As we begin to depend less on despotic regimes around the world and more on localized, stable energy stocks, it will keep oil prices in check, to the greater benefit of the economy as a whole....