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Bonterra Energy: The Leverage Play On The Oil Price Has Delivered Strong Returns

Apr. 05, 2022 9:35 AM ETBonterra Energy Corp. (BNEFF), BNE:CA5 Comments


  • Bonterra Energy has more than doubled since I last discussed the company just over three months ago.
  • The cash flows will be exceptionally strong this year thanks to the high oil and gas price, but all cash flow will be used to reduce the net debt.
  • I only have a small position, so it's an easy decision to take my profit and sell, as I want to reduce my exposure to oil.
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It has only been about three months since I last discussed Bonterra Energy (OTCPK:BNEFF) but the company’s share price has done exceptionally well with a share price appreciation of approximately 150% as the stock is currently trading over

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This article was written by

The Investment Doctor profile picture
As I'm a long-term investor, I'll highlight some stockpicks which will have a 5-7 year investment horizon. As I strongly believe a portfolio should consist of a mixture of dividend-paying stocks and growth stocks, my articles will reflect my thoughts on this mixture.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of BNEFF either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I will likely sell my position in Bonterra shortly.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (5)

Next to no dilution for years and years which is something not too many oil companies can boast.
The FCF per share is certainly a good story but these guys just have too much debt. They truly need the Goldilocks oil price scenario to thrive. OBE will possibly finish the with less debt but over 2x the production, for example.
lets get that dividend flowing again.
I agree that BNE is now a modest sell, at least relative to other opportunities. I would also add OBE to this list, which has had the same YTD performance as BNE (>100% return), but is now ahead of itself. With buy backs starting in 2Q, I prefer BTE, which on a relative basis, has under-performed.
Great article. I also took profits because of the share price rising that fast.

You know the question not easy to answer: How to redeploy this money? InPlay Oil might be an alternative albait the share price just the same. I saw a presentation with management and liked what I saw. They presented their company as a deep value play.

My huge buy and hold position in this space is Canadian Natural Resources. They will pay good dividends till I die. No need to sell.
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