67 WALL STREET, New York - November 27, 2012 - The Wall Street Transcript has just published its Oil and Gas Investing Forecast offering a timely review of the sector to serious investors and industry executives. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Oil and Gas Investing
Companies include: TransCanada Corp. (TRP), Spectra Energy Corp. (SE), Enbridge (ENB) and many others.
In the following excerpt from the Oil and Gas Investing Forecast, an expert analyst discusses the outlook for the Canadian Oil & Gas sector for investors:
TWST: About which kinds of energy infrastructure companies are you most bullish about at the moment and why?
Mr. Akman: Generally, I like pipeline and midstream companies for a couple of reasons. In Canada, and to some extent in the U.S. as well, there is a resurgence of production growth in oil and also natural gas liquids, which is driving a big infrastructure expansion wave. Also, the reconfiguration of existing infrastructure to handle unconventional oil and gas is creating significant growth and investment opportunities for the companies. So whether you're in long-haul pipeline and you'll kind of connect the oil sands to new markets, or whether you're a midstream and you're trying to connect new oil and gas flows to long-haul pipelines, there is big investment opportunity here.
And generally, the returns on investment remain very attractive. So these investments are creating significant shareholder value. And the trend for this growth has been going on for a couple of years, but probably has a multiyear forward cycle behind it, but it should drive earnings and dividend growth for the foreseeable future. So I like this sector within my overall coverage universe.
TWST: Conversely, about which kinds of energy infrastructure companies are you a bit more hesitant and why?
Mr. Akman: I've been very negative about merchant power and to some extent our negative outlook has already been reflected in the stocks. And although the Canadian unregulated power has not done as badly as U.S. unregulated power, it's still done pretty badly. And I think that even though the stocks have done pretty badly, there isn't really insight in their lows, because power prices probably will remain depressed in most places until there is a concerted economic recovery. And the reduction in natural gas prices also tends to have a dampening effect on power prices for the foreseeable future, so baseload power generators have seen gross margin compression that may not come back for quite a long time...
For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.