Ensign Energy Services (ESI-T) revisited 3.0 top pick from Teal Linde on BNN.ca Market Call Mon Dec 20th @ 1200ET
Back in January 2020 before the pandemic, oil and natural gas prices were trading around $50 and $2.50, respectively. Ensign’s share price was also trading around $2.50. Today, oil and natural gas prices are considerably higher, yet Ensign is still more than 30 per cent below where it traded last January before the pandemic began. Holding the company back is a wave of capital discipline that has restrained publicly-traded E&P companies from expanding their capex budgets, as paying down debt and returning capital via dividends and share buybacks has become the new playbook. However, with steep natural declines in the Permian, where the company has most of its U.S. rigs, strengthening balance sheets across the industry, drilling budgets are gradually increasing, which should support the recovery of the company’s share price, particularly if oil prices stay above $60.
Last purchased on Dec 10, 2021 at $1.75 |
