it would seem to me that the downside on HTE should be fairly limited unless oil and gas prices fall significantly from here, which is always a possibility, no matter what t. boone pickens tells you <g>
i figure that the new tax rules are factored in at this price, and in fact, since the effect of those rules doesn't begin for many years, it is probably more than priced in now
it's certainly possible that they will reduce their payout next quarter, or later in the year, especially if oil prices stay in the low 50s or drop to the 40s...i would think that they could reduce the payout to the low double digits in terms of yield without doing much damage to the stock price
HTE is only a very small position for me, so while i see it with no more than average risk, and reasonable reward, especially if i can keep selling calls against it each month, it's not one i would feel comfortably buying a big position in...i don't think it will rally significantly unless the tax rule changes are revoked, or unless oil prices surge significantly, neither of which seem likely to me at this point
others here probably have a better feel for the various canroy investments, just remember that a balanced view on energy will give you the most reasonable evaluation...you have to throw out the views that oil can only go up from here, etc.
JMHO of course |
