# Pacific Rubiales Energy Corp (T.PRE)



## nobleea (Oct 11, 2013)

Any thoughts on PRE right now? It's been taking something of a hit over the last while. Down to as low as $15.32 today, which gives a yield of 4.75%.


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## Jacq (Feb 8, 2014)

I'm going to be looking into them some time in the next week and will post what I find. It could be a few things - licenses/politics, crazy pipeline bombers, STAR technology... ? I owned 2 of their takeovers - PMG and C&C but sold out when the deals went through. Their guidance looks pretty good to me though.

Technical indicators aren't positive at all yet. I'd wait until the moving averages start to show an uptrend even if it means you leave a bit on the table. Or take a small position now and see how it plays out. Just worried it might be a little bit of a falling knife although it doesn't seem like there's much further to fall on this one.


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## nobleea (Oct 11, 2013)

Jacq said:


> I'm going to be looking into them some time in the next week and will post what I find. It could be a few things - licenses/politics, crazy pipeline bombers, STAR technology... ? I owned 2 of their takeovers - PMG and C&C but sold out when the deals went through. Their guidance looks pretty good to me though.
> 
> Technical indicators aren't positive at all yet. I'd wait until the moving averages start to show an uptrend even if it means you leave a bit on the table. Or take a small position now and see how it plays out. Just worried it might be a little bit of a falling knife although it doesn't seem like there's much further to fall on this one.


It hit bottom around $15 at the end of February. Big jump today on fourth quarter results with record production levels and beating profit expectations. Over $18 now. I think it'll be over $20 this year, possibly in the 24-25 range.


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## HaroldCrump (Jun 10, 2009)

PRE routinely cycles from mid $20s to mid teens and back up again.
There are very complex geo-political issues with this company, incl. delays in some permits, expiring leases, etc.
Do not buy before looking into it.

This is not a buy-and-hold, dividend paying energy company like our own Crescent Point, Husky Energy, Suncor, Imperial, etc.


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## nobleea (Oct 11, 2013)

HaroldCrump said:


> PRE routinely cycles from mid $20s to mid teens and back up again.
> There are very complex geo-political issues with this company, incl. delays in some permits, expiring leases, etc.
> Do not buy before looking into it.
> 
> This is not a buy-and-hold, dividend paying energy company like our own Crescent Point, Husky Energy, Suncor, Imperial, etc.


Yes, it's definitely a bit of a cyclical stock, and the cycles don't seem to be related to anything external, just sentiment I guess. I am aware of the issues/history behind the company. They are one of our customers and have been for quite some time.

Up past $21 now. I would think 24ish is where it will land before the summer is out.

Though there have been some rumblings of Repsol kicking the tires. I think any possible buyout would happen in the 28-31 range but at this time seems pretty unlikely.


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## nortel'd (Mar 20, 2012)

Can PRE-T be transferred to a US dollar trading account? 
I just noticed Pacific Rubiales Energy Corp pays its dividend in US dollars not Cdn and on March 26 I was charged a forex fee of $1.13Cdn to convert $66US.
It appears to only trade on the TSX (not on NYSE) and I am holding it in my Canadian dollar trading account.


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## HaroldCrump (Jun 10, 2009)

Yes, it should be possible to do this.
All TSX listed stocks have a US equivalent, traded OTC/Pink Sheets.
I believe PRE's US OTC equivalent symbol is PEGFF.

Ask your brokerage to journal it over to the US side of your trading account.
After a couple of days, you should see the symbol converted from PRE to PEGFF.

There are a couple of other such "weird" stocks on the TSX that pay dividends in USD but are not listed on any of the big boards (NYSE, NASDAQ, or AX).
I hold a similar small cap REIT that pays distributions in USD but trades OTC in the US.

Caveat : the US OTC trading volumes are usually very thin or even non-existent in some cases.
Spreads are crazy.
In other words, you will not be able to (and should not) trade this in the US OTC.
If/when you want to sell, have it journaled over again to the TSX side, and then sell it.


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## nortel'd (Mar 20, 2012)

HaroldCrump said:


> Yes, it should be possible to do this.
> All TSX listed stocks have a US equivalent, traded OTC/Pink Sheets.
> I believe PRE's US OTC equivalent symbol is PEGFF.


Thanks. I just finished having them journaled over as PEGFF into my $US trading account. I am to late to get the June 26th dividend in $US and have prepared myself to give up another $1.13 in Forex fees.



HaroldCrump said:


> Caveat : the US OTC trading volumes are usually very thin or even non-existent in some cases.
> Spreads are crazy.
> In other words, you will not be able to (and should not) trade this in the US OTC.
> If/when you want to sell, have it journaled over again to the TSX side, and then sell it.


This advice is very much appreciated.


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## humble_pie (Jun 7, 2009)

harold is right ... see that "F" at the end of PEGFF?

it stands for the "foreign" section of US pink sheets. There are plenty respectable foreign stocks in that section. They're all called tracker stocks. 

US brokers don't maintain any inventory of these tracker stocks. When a client wants to buy or sell one of em, the US broker - via a complex network - gets that trade executed on toronto. If it's a british or a french or a hong kong or a vietnamese tracker stock, broker will get that trade also executed on its native exchange.

along the way broker charges - via huge spreads like harold said - a ginormous commish to compensate for a) his forex exposure in CAD; & b) his backbreaking trouble.

so don't buy or sell a US tracker stock, when it's really a canadian stock. Just bring it home like Little Bo-Peep & sell it here on toronto each:

PS if you account is held at one of the smaller privately-owned brokers (not naming any) there *might* be a problem with getting a correct T5 tax slip with correct canadian dividend tax credits. The big bank brokers will be OK about the tax creds, but there are rumours that some of the little guys don't have systems that can handle this kind of detail ...


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## nobleea (Oct 11, 2013)

Mexico's Alfa bought 9mil more shares today to bring their total to 54mil shares or over 17% of the company. Me thinks a takeover might be in the future.


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## james4beach (Nov 15, 2012)

Fast forward two years. I want to remind people what happens to some stocks... this is the danger of stock picking and it's why you can't buy & hold a stock forever. You must have an exit strategy from any stock.

Pacific Rubiales aka Pacific Exploration (PRE) has filed for protection from creditors, as it's insolvent [1][2]. Trading of shares is suspended. The last trades were at $0.64 on the TSX. The pink sheets PEGFQ still trades, at $0.08 (eight cents).

Since this last discussion from August 2014, the shares have lost 99.6% of their value. A buy & hold investor would have been totally wiped out ... lost everything.

In contrast, the sector XEG in this time frame is down 40% which is considerably better. More importantly, it still trades and would not have wiped out an investor. To me this is the great appeal of index investing. You don't have to individually monitor each stock, which is essential with individual positions.

I think it's feasible and legitimate to maintain a stock portfolio but you have to monitor the positions -- which is a lot of work. If you truly want to buy & hold & forget, then you must use an index. The indexes don't go to zero.


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