On Sunday it was reported that Encana was going to break up into two companies.
Encana will now hold just natural gas assets in Canada and the US that will probably have higher growth rates, 2/3 of the value is in this company.
the other half will include refinery, cdn. oil sands production, and more mature nature gas assets in Alberta. though it will probably have slower growth still unlike most oil companies production should easily double in 4 years if not more.
ECA is up over 6% on the news to around 91.70US. also some other energy stocks mentioned here have followed.
such as TLM, NXY, CNQ. NXY has moved up from 28 to around 38, TLM 18 to 23, and CNQ from 64-68 to 96.
so not sure if there is a lot of value to be had if they are broken up, ECA broke up becuase no one gave it credit for oil sands and refinery operatons.
these companies will be large however there is a good chance they are taken out in the next 3-5 years. if you are a large European or US oil company you probably have no production growth. it is exposible to get a land package for natural gas like Encana.
also though the oil spinoff is slower growth will still be much more than most.
at these valuations would rate these companies a hold.
own TLM, CNQ, NXY and ECA, oil (toronto), and some other midcaps.
use to have a large postion in NXY however was tired of them missing numbers slighlty so sold 2/3 between 30-32...yikes.... for a small gain. have the remaining positon.
my two natural gas plays are ECA, and Devon. also have puts on ECA from 60-70. if you have large positons would trim and take some profits after this run up....
thanks
selkirk
Encana will now hold just natural gas assets in Canada and the US that will probably have higher growth rates, 2/3 of the value is in this company.
the other half will include refinery, cdn. oil sands production, and more mature nature gas assets in Alberta. though it will probably have slower growth still unlike most oil companies production should easily double in 4 years if not more.
ECA is up over 6% on the news to around 91.70US. also some other energy stocks mentioned here have followed.
such as TLM, NXY, CNQ. NXY has moved up from 28 to around 38, TLM 18 to 23, and CNQ from 64-68 to 96.
so not sure if there is a lot of value to be had if they are broken up, ECA broke up becuase no one gave it credit for oil sands and refinery operatons.
these companies will be large however there is a good chance they are taken out in the next 3-5 years. if you are a large European or US oil company you probably have no production growth. it is exposible to get a land package for natural gas like Encana.
also though the oil spinoff is slower growth will still be much more than most.
at these valuations would rate these companies a hold.
own TLM, CNQ, NXY and ECA, oil (toronto), and some other midcaps.
use to have a large postion in NXY however was tired of them missing numbers slighlty so sold 2/3 between 30-32...yikes.... for a small gain. have the remaining positon.
my two natural gas plays are ECA, and Devon. also have puts on ECA from 60-70. if you have large positons would trim and take some profits after this run up....
thanks
selkirk
