Oil & gas stocks, including those that provide equipment and services to explorers, have been hammered over the last year and a half as oil prices have tumbled. The Canadian oil & gas sector has been hit particularly hard. This is because many of the oilfields in Canada are unconventional and therefore extracting oil is much more expensive. Oil prices have to be around $60 per barrel to allow exploration companies to make a profit from Canada’s unconventional fields.
Prices have been way below these levels but the good news for the Canadian oil & gas sector is that the market could be bottoming out. Indeed, several producers have agreed to freeze production, which will help in improving fundamentals of the oil market.
This development makes the Canadian oil & gas sector worth a look, especially given the current valuation. High Arctic Energy Services Inc. (TSX: HWO) is a provider of services to the oil and gas industry. Since June 2014 when the slide in oil prices began, HWO shares have fallen more than 36%. At current levels though, HWO looks attractive. But apart from attractive valuation, HWO also offers attractive dividend yield.
HWO currently offers a dividend yield of 5.67%. Earlier this week, the company announced that its Board of Directors approved a monthly dividend payment of $0.0165 per share.
