Income – A 6.3% Dividend plus Growth Potential

Posted by Keith Schaefer -Oil & Gas Investments Bulletin

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I bought another 500 shares of Canadian Energy Services today at $15.25 after they announced an increase in their dividend from 6 cent to 8 cents a month, for a 6.3% yield.  US expansion is obviously going well (though not so well that they need that capital to handle the growth there).  Q2 is their weakest quarter because of Canadian spring break up so this tells me those numbers should be very good compared to prior years – again, due to US expansion which is not so seasonal.  And recent buyouts in the sector would translate into a $26/sh valuation for CEU-TSX.  However, the stock already has a lot of future growth priced in.  I like it because I see it as a strong defensive stock in a very volatile energy market.

I now own 2000 shares.

Weekly Chart included by Money Talks




Hello, this is Keith Schaefer, editor and publisher of The Oil & Gas Investments Bulletin.  I started my subscription service in mid-2009 because I could see there was no place where retail investors could go to easily find which oil and gas companies were creating huge shareholder wealth by using exciting new technologies, such as horizontal drilling, fracing and 3D seismic.

These companies are increasing cash flows – and stock prices – by finding ways to get more oil and gas out of the ground.  And junior and intermediate producers – $2-$20 stocks – are leading the way.

I find the leaders in the new plays that are using these technologies.  My research is finding  higher and higher flow rates from new wells in old formations as management teams fine tune their use of these new technologies.

It’s amazing how technology is lowering operating costs – and increasing profits – for many publicly traded energy companies.

I find the ones who have the capital and the knowledge to be the fastest growing in their area – this usually means they have a large undeveloped land position in an area where either production costs are very low or production rates can be very high.  They are covered by several research analysts, so there is research support and institutional money flow behind them.