The oil market just got a historic geopolitical shock — and Eric Nuttall says market complacency is creating a major opportunity in energy stocks. The Partner & Senior Portfolio Manager at Ninepoint Partners, joins In the Money with Amber Kanwar for an emergency session to break down the implications of the Iran crisis, why the market may be dangerously complacent about global oil supply, and why he believes energy stocks remain in a multi-year bull market.
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PAST PICKS (DATE: JANUARY 21, 2025)
Veren: +17% (acquired)
MEG Energy: +30% (acquired)
Athabasca Oil: +64%
Average: +37%
PAST PICKS (DATE: MAY 1st, 2025)
Expand Energy: 7% (still holds)
Arc Resources: +5% (no longer owns)
NuVista: +61% (acquired)
Average: +24%
PRO PICKS
1. Whitecap Resources (WCP) – Largest holding (≈11.5% of fund)
- Trades at a deep discount (currently ~4× cash flow at $70 oil vs. 7–8× for larger peers) despite 16 straight quarters of beating estimates, 25+ years of Tier-1 inventory, and a market cap (≈$16.5 B) that is now fully institutionally palatable.
- 5.4% dividend + pristine balance sheet; Nuttall sees a clear path to a 7× multiple at $70 WTI, delivering a $20.54 target (51% upside) purely from execution and modest multiple rerating.
- Zero M&A needed — just “milk free cash flow and buy back half the stock over the next five years”; the stock is still lagging peers YTD despite flawless drilling and the Veren acquisition at an attractive price.
2. Athabasca Oil (ATH) – Multi-year compounder with massive reserves
- World-class long-dated oil-sands reserve base that becomes increasingly strategic as global booked reserves hit historic lows while demand peaks; Nuttall is deliberately “aggregating resource” here for the coming crunch.
- Even at flat $70 oil, modest production growth + aggressive share buybacks compress the multiple from 7.5× today to ~5× within three years — delivering outsized returns without needing higher commodity prices.
- Ignore short-term valuation downgrades (Bay Street analysts are “job-preserving” and strip-based); the stock has already delivered 64% since last recommendation and Nuttall refuses to sell into strength because the real payoff is still 2–4 years away.
3. Ovintiv (OVV) – Repositioned, cleaned-up, buyback machine (9% position)
- Portfolio overhaul complete: now focused solely on high-quality Permian + Montney positions with 15–20 years of drilling inventory; all non-core assets sold, debt paid down, and every historical “knock” or skeleton removed.
- Returning at least 75% of free cash flow via buybacks (potential 10% of shares retired annually) — the exact catalyst Nuttall has repeatedly profited from in other names.
- Currently at only 5× cash flow / 10–11% FCF yield; a move to a conservative 6× multiple at $70 oil generates ~50% upside while the stock finally transitions from “hedge-fund hotel” to institutionally owned name.
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DISCLAIMERS: This text AI generated and should be checked against actual delivery. The content provided in this podcast is for informational purposes only and does not constitute financial, investment, or professional advice. The views expressed by the host and guests are their own and do not necessarily reflect the opinions of any organization or company. The host and guests may maintain positions in any securities discussed on the podcast. Always consult with a qualified financial advisor or professional before making any investment decisions.
