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Gold/Mining/Energy : Canadian REITS, Trusts & Dividend Stocks

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To: LLCF who wrote (318)	5/13/2000 11:50:00 AM
From: Lorne Larson	Read Replies (1) of 11633

My theory on oil and gas trusts is that at this point you simply buy the ones that are spinning off the highest percentage yields, and forget about things like debt ratios, reserve life, etc. As long as oil and gas prices stay up, all of these trusts are going to make a lot of money, and none of them are in any financial trouble. Might as well collect the 20-30% dividends while they're here. Of course, the high yielders will be the ones that will take the biggest hit if and when oil and gas prices start dropping. Cheapest trust on the market is MXT.UN. At present cash flow of 1.4 million/month, and the units trading at $2.60. the P/CF is 1.86! Being punished for the dividends being suspended until the bank debt is brought into line. Bank debt ratios are now comparable to other oil and gas trusts, and new banking arrangements are being put into place. Dividends will likely be reinstituted very shortly. I've been buying some of this, but if I had any guts I'd sell all my other trusts and really load up on MXT. If 75% of the cash flow - say 1 million/mo - is used to pay dividends, the yield will be 38%. Regards

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