Canadian oil and gas companies find little interest in the stock market share of stockholders are recharging shares that are increasing purchases of the shares in the current year.
Instead of investing in your business to grow money instead of using dollars, it's impossible for them, but the viewers make sense in your wallet and in your stock exchanges.
& # 39; Cyclic Business & # 39;
"As a CEO, as I look at, it is a cyclical business. Buy your shares in good cash flow and in good balance, when your shares are very low, it's a good business." said Dale Dusterhoft, CEO of Calgary, Trican Well Service Ltd. to complete the company.
"But after you've created your multiples and you're in a cycle, your capital is a good business to buy other things."
Trican bought 9.8 million shares in October after renewing its annual purchase program. The maximum amount purchased bought 10 percent of $ 119 million under the 2017-18 program.
Some 627 million shares were issued in 2018 to cancel 209 emission companies in mid-October, data provided to the TMX Group, at the request of the Canadian Stock Exchange, Toronto Stock Exchange.
That is, it has 135 million shares more than in 2017, much earlier than 557 million shares in 2007, according to statistics from 1989 onwards.
Twenty-three Calgary companies participated in the oil and gas sector in 184 million shares this year, more than $ 76 million in 2017.
The energy company shares the company's purchases on the western boundaries of Canada, where there has been a lack of ability to grow production at oil prices, which has led to unprecedented VAT prices before the US benchmark, said Eric Nuttalk at the Ninepoint Partners in Toronto.
"We have had the greatest dislocation in history between goods and stock," he said. "Energy values are marketed in the midst of historical multiples."
In West Texas, in New York, the average level of average US $ 75 in excess of US $ 75 has decreased at an early average in the beginning of October at a lower risk, which only increases "bunker mode" and less purchases has it. Nuttall said.
Shopping better than drill risk: Nuttall
"But if there is no difference in price at commodities prices, for WTI $ 60 and other standard, the price of the shares does not reflect the value, it is better to recover your shares rather than the risk of drilling your wells," he said.
Purchase appeal is not lost in the Canadian Chief of Natural Resources Collaboration. As a result, on November 1, a new capital allocation strategy was presented, after obtaining half of the future cash, when capital expenditures and dividends were sold, the rest owed the debt.
It has purchased 20 million shares since September 30, a cost of $ 874 million, according to a plan approved next summer to buy 61 million shares next year.
The executive vice president Steve Laut said in a conference call that "significant recovery" in purchases "creates the value of shareholders in the current market conditions". On November 1 this year, the company's shares ended at $ 37.84 and from a period of 16 months to 12 months.
This month, Suncor Energy Inc., the largest oil and gas company in Canada in the market capitalization, said it has allowed the current purchasing program to increase its three percent percentage of its three percent.
Spending $ 1.98 billion in 39 and 39 million shares in May and November, an expanded program would spend another $ 1 million if it is fully implemented.
In theory, reducing the number of shares in the company shares the value of other shares increasing; It must boost investment measures, such as profits and production per share, which can lead to higher market prices per share.
That's not what Trican has done.
During the 30-month period 30 months, 34 million shares were bought and canceled, half of its value was lost at $ 4.56 and $ 2.31.
Dusterhoft acknowledges "mixed results", but still believes that buying is a strategy that will make it possible for good returns on shareholders.
The drop in prices in Trican prices denounced the shares of energy service companies that were associated with poor prospective drilling prospects in Canada, which limited the exploration costs.
"Although the share price itself stopped, they would achieve a hundred percent performance in that period. I think we have seen that the decline in the market for the past year has been negative."