Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, Canadian energy trust Penn West Energy Trust (NYSE: PWE ) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Penn West's business and see what CAPS investors are saying about the stock right now.
Penn West facts
| Headquarters (Founded) |
Calgary, Canada (1979) |
| Market Cap |
$10.6 billion |
| Industry |
Oil and gas exploration and production |
| Trailing-12-Month Revenue |
$2.5 billion |
| Management |
CEO William Andrew (since 2005)
CFO Todd Takeyasu (since 2006)
|
| Return on Equity (Average, Past 3 Years) |
6.9% |
| Trailing Dividend Yield |
4.6% |
| Competitors |
EnCana (NYSE: ECA )
Suncor Energy (NYSE: SU )
|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 97% of the 1,397 members who have rated Penn West believe the stock will outperform the S&P 500 going forward. These bulls include All-Star mikecart1, who is ranked in the top 5% of our community, and Harptree.
Just last month, mikecart1 tapped Penn West as an ideal way to make some income: "Returns are nothing short of outstanding. Solid energy company that is diversified. What more can you ask for? Oh yeah a sick dividend play too."
Despite a recent distribution cut from $0.15 to $0.09 -- Penn West will convert to a corporation in 2011 due to the new tax levied on Canadian trusts -- the stock remains one of our community's favorite income opportunities. Even with the reduced payout, Penn West still sports a higher dividend yield (4.6%) than rivals EnCana (2.9%) and Suncor (1.1%), as well as energy behemoths Chevron (NYSE: CVX ) (3.2%), ConocoPhillips (NYSE: COP ) (3.3%), and ExxonMobil (NYSE: XOM ) (2.4%).
CAPS member Harptree elaborates on the bull case :
I realize the distributions have gone down due to oil prices and the trust conversion, however, please keep in mind we Americans are looking at a Canadian company through U.S. eyes. ... My point being, Canadians are running [Penn West] and similar companies for the benefit of the unitholders/ shareholders and not for the benefit of upper management. I truly believe the leadership of [Penn West] is going to do what is right for the shareholder over the long haul. This is a great company in the energy business on friendly soil and I feel the reserves are stated at a conservative 50%.
What do you think about Penn West, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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