Friday, September 11, 2009

Penn West Energy Trust 2

I am continuing my review of this stock (TSX-PWT.UN; NYSE-PWE) today as I had not previously reviewed it and the 2008 year end annual statement has came in. I also own this stock. I bought this stock in January 1998 and according to Quicken, I have made 6.7% return per year on this stock. Unfortunately, just after I bought this stock, the price plummeted. This is oil and gas, and the price for oil and gas can change rapidly. If I had bought some more at the end of the year, I would have made a lot more on this stock over the years.

When looking at Insider Buying and Insider Selling, I find that there has been little activity, especially of late. There was some selling at the end of 2008 when the shares were over $25 per share. There was also a bit of buying early this year when the stock price was under $10.

When I look at the P/E ratio, I find that it was around 4 at the end of 2008. However, the future P/E for 2010, when this stock is expected to having earnings again, it would be between 30 and 40. This is very high, considering the 5 year average low is just below 19. This stock is not expected to earn any money this year, so you cannot calculate the P/E when the earnings are negative. I have also reloaded my spreadsheet as I got some of the past stock prices wrong.

When I look at analysts’ recommendations, the consensus is a Hold. There are a number of analysts that follow this stock with most recommending a Hold, but there are some underperform ratings also. There are no other recommendations for this stock that I can find. (See my site for information on analyst ratings.)

It is the largest conventional oil and natural gas producing trust in North America. They operate only in Alberta. Its web site is See my spreadsheet at

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website at for a list of the stocks for which I have put up spreadsheets.

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