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TSE:WCP

Whitecap Resources (WCP.TO)

15.54
+0.18 (1.17%)
as of Jun 19, 2026, 8:00:00 pm Market Open.
488 watching
0
DON'T BUY

Damaged business model. Key risk is where you see energy price volatility, the business model doesn't make sense. It does make sense in the mid-$60 range, where we are now, which is why people are picking it up. But he favours TOU.

WEAK BUY
He has had a lot of respect for them over the years. They have always been very well managed. Decline rates are among the best in the industry. If he had to buy an E&P company this would be it. He has had more success in the mid-streamers however.
BUY

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Results exceeded guidance and showed growth across all metrics. There was an increase in production. Integration of their acquisitions are going well. Poised for good growth but remains relatively cheap. Unlock Premium - Try 5i Free

BUY
At $80, it would trade at 2.1x next year's cashflow, which is close to $15. A net negative emitter and best rated ESG energy company. There is alignment between the stock and management interest. The name will do quite well.
BUY

A big fan of the company and management. Sold it around a month ago due to relative valuation. Bought it back this year. A net negative emitter. Could get a multiple expansion. At a 6x multiple and $60 oil, it would be 63% upside. Have differentiated to acquire further gains. Bought Torc and it is still a target rich environment.

WATCH

Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Results were better than expected in the most recent quarterly earnings report. Cashflow and revenue declined though payout ratio is only 37% still. The merger offers good synergy. As commodity prices improve, 5i is warming up to this name. Unlock Premium - Try 5i Free

BUY ON WEAKNESS
Do the Saudis need $80 oil to survive? It's true. The Saudis have been drawing down their foreign exchange reserves to cope with low prices. WCP made him a lot of money before. It's had a big run recently, so he favours other names. It's currently trading at a premium vs. peers. That said, he sees 64% upside--decent, but he sees more upside in other oil stocks. They've made some great acquisitions. He'd certainly buy this on pullback, though.
BUY

WCP-T vs. MEG-T. WCP-T is more towards the high quality side. It has performed excellently and rolled up some smaller companies. They will continue to consolidate the space and the dividend is safe. MEG-T is more leveraged to the upside. WCP-T is more of a safe haven. He prefers WCP-T.

COMMENT

WCP buying TORC Oil Like with Suncor, we've had a relief rally in oil and cyclicals. Instead of vibrant competition in this industry, all this pressure on oil will reduce this space to a handful of names. He's looking for the highest free-cash flow producers at their lows. WCP gets stronger with this merger and should see a valuation bump. He'dd love to see WCP easily go 50-100% higher, but this will happen only if money outside the sector drives it. This is why he won't buy WCP now. CNQ is a safer play, more certain that CNQ will make money in the next 12 months. That said, if the price of oil rises, WCP will certainly surge.

TOP PICK
The deal with Torc is positive. The stock price was re-rated and it has gone up. They have first mover advantage and have an edge in the space. 13% free cashflow yield at $50, 25% at $60. A good name to own in the small-mid-cap range. They are a net-zero emitter with their carbon injection technology. (Analysts’ price target is $5.41)
BUY

WCP vs. CPG Both are good given strong sector rotation coming back to energy. Owns WCP for the dividend and growth potential.

DON'T BUY
Unlikely dividend will increase. None of these companies are gushing cashflow, credit risk profiles are not strong, and most aren't investment grade. This one is small, and general investors want exposure through the largest and most diversified names.
TOP PICK
The mid-cap names are where you really want to focus. They have done a good job of taking advantage of the pandemic and doing MNA. It will be one of the first names to profit from money coming back to the sector. They could gain even bigger scale and be re-rated by multiple. Currently trading at 16-30% free cashflow yield. (Analysts’ price target is $3.57)
DON'T BUY
6-month outlook? It's hanging in there, but they have issues in capital and investor aversion against all oil stocks. WCP didn't manage this year's downturn as well as it should. He's less enthralled with it now than before. WCP needs more than six months and more like 18-24 months to see a real rise in the stock. WCP is okay.
PAST TOP PICK
(A Top Pick Nov 15/19, Down 33%) The stock is down 53% year to date. They were not rash in the beginning of the year. They only cut dividends by 50% compared to others who slashed them or cancelled completely. A good executer of mergers and acquisitions. There is insider buying, dividend, and good balance sheet. A net negative emitter due to their CO2 injection project so it is good for ESG investors. Trading at 3.9x next year and 20% free cashflow yield.
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