Shares of Canadian oil & gas have certainly been on a bumpy ride in recent years.
The company has experienced significant turmoil, and while some of this turmoil can be related to Canadian commodity prices that continue to remain unsavory for many investors interested in growth, the company's focus on increasing its debt load to finance a large U.S. acquisition left many shareholders unimpressed, to say the least.
Some could say that the company's hand was forced into slashing the firm's dividend - Altagas' share price was hit so hard that the dividend yield was in the stratosphere for a period of time - but reality remains that for dividend investors, such a cut was a big hit to the cash flow expectations and needs of many who rely on dividends from companies like Altagas over the long term.
Altagas bulls may indeed note that the company still offers investors a dividend yield of 5.4% - not too shabby for an investor who bought in recently, but a pittance for an investor who has held Altagas stock for a year or two.
The company's fundamentals do look better than they have in the past, evidenced by the most recent set of earnings numbers which put the firm's year over year increase in EBITDA of 26% in the spotlight. If Altagas' management team is indeed able to pay down debt in a meaningful way, as they have indicated, then perhaps this is a company worth considering. If not, investors may be on the hook for more turmoil to come.
Invest wisely, my friends.
