Higher output in store for these producers

Article Excerpt

PEYTO EXPLORATION & DEVELOPMENT CORP. $22.04 (Toronto symbol PEY; Shares outstanding: 133.1 million; Market cap: $2.9 billion; TSINetwork Rating: Extra Risk; Dividend yield: 3.3%; www.peyto.com) produces and explores for oil and natural gas in Alberta. The company changed its name from Peyto Energy Trust after it converted from an income trust to a dividend-paying stock on December 31, 2010. Peyto’s average daily production of 31,531 barrels of oil equivalent (including natural gas) is weighted 88% toward gas and 12% to oil. In the three months ended March 31, 2011, Peyto’s cash flow rose 9.8%, to $0.56 a unit from $0.51 a year earlier. The shares trade at 9.4 times the company’s forecast 2011 cash flow of $2.35 a share. Peyto’s long-term debt of $450 million is a low 15.5% of its $2.9-billion market cap. Before it converted, Peyto paid a monthly distribution of $0.12 a unit. However, it has since cut its payout to $0.06 a share. It has tax pools that…

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