Crescent Point Energy Corp. (TSE:CPG) stands out among Canadian oil and gas E&P companies thanks to its dividend yield, exposure to oil, its conservative approach to credit and its currently attractive valuation, says Don Rawson, Managing Director at AltaCorp Capital Inc.
“Among the yield names, definitely Crescent Point sticks out as a very well-run company with a well-regarded management team and business model. It is focused in a few key top-notch oily resource plays, it has great netbacks and is very conservatively run in terms of its balance sheet, hedge book and track record of managing Street expectations,” Rawson said.
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Crescent Point is currently trading inexpensively compared to historical multiples. Rawson says the 8%-level yield further makes the company attractive.
“It typically trades at a premium multiple supporting its business acquisition model, which has been one of the cornerstones of its strategy in the past. Right now though, it has sold off, and it’s quite attractive on today’s valuation, yielding close to 8%. On our numbers, it’s trading at about eight times debt-adjusted cash flow this year, which is really quite cheap compared to its typical trading multiple historically,” Rawson said.
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