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bnn market call

Eric Nuttall is portfolio manager at Sprott Asset Management. His focus is oil and gas stocks.

Top Picks:

Legacy Oil + Gas

U.S. money is returning and Legacy should be at the top of their shopping list trading at 4.5X EV/CF versus a 15 year reserve life and the ability to more than double reserves beyond that. Regaining a fraction of their former multiple after five quarters of beating expectations would result in a $9+ stock.

TORC Oil & Gas

Great well results in several plays could lead to a guidance and dividend increase in the next few months. TORC can pay the current dividend and grow by 8 per cent per year while spending less than their annual cash flow.

Athabasca Oil

Legal conclusions in the coming months should allow them to receive $3.30/share in cash from Petrochina. That combined with a possible joint venture on their Duvernay acreage could lead investors returning to the story after a few very frustrating years. Asset value exceeds $10/share.

Past Picks: September 19, 2012

Painted Pony Petroleum
Then: $10.13
Now: $8.00
Total return: -21.03 per cent

Whitecap Resources
Then: $7.56
Now: $12.08
Total return: +66.28 per cent

Crescent Point Energy
Then: $43.55
Now: $38.69
Total return: -4.61 per cent

Total return average: +13.55 per cent