Our two new trust recommendations

Article Excerpt

PEYTO ENERGY TRUST $13.25 (Toronto symbol PEY.UN; Units outstanding: 120.9 million; Market cap: $1.6 billion; SI Rating: Extra Risk; Dividend yield: 10.9%) produces and explores for oil and gas in Alberta. Its average daily production of 19,133 barrels of oil equivalent (including natural gas) is weighted 83% toward natural gas and 17% to oil. At current production rates, Peyto has proven oil and natural-gas reserves that should last 14 years. Peyto’s cash flow was $0.46 a unit in the three months ended December 31, 2009. The units trade at 7.3 times the trust’s annualized cash flow, based on the latest quarter. Peyto’s long-term debt of $435 million is a reasonable 29% of its $1.6-billion market cap. The trust just raised $74.9 million by issuing new units. It will use these funds to expand its 2010 exploration program to $175 million to $200 million, up from $72.7 million in 2009. The units yield 10.9%. Peyto paid out a relatively low 78% of its cash flow…

You are trying to access subscriber-only content.

To read this article, you may subscribe or sign in.
If you are already a subscriber, log in here.

If you wish to become a subscriber, click here. Or you may enjoy access to all our publications when you become a Member of Pat McKeough's Inner Circle Pro.