Pullback in Top Dividend Segments Drives Yields Higher Across the Board (PWE, PVX, TRU, HGT, NLY, CMO, ANH)

Tickerspy’s Canadian Energy Trusts Index

CANADIAN ENERGY TRUSTS INVESTING IDEAS

• Popular long ideas: PWE, PGH, ERF
• Popular short ideas: PWE, PGH, ERF
• Top dividend plays: PWE, PGH, BTE
• Pro favorites: PWE, ERF, PGH

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CANADIAN ENERGY TRUSTS COVERAGE

Typically high-yielding, energy-focused Canadian companies that employ a Royalty Trust operating structure

• Income Producing Commodity Plays Outshine High-Yield Peers (PVX, PWE, BTE, ERF, SJT, BPT, MVO, WHX)
• High-Yield Commodity Plays Boast Weekly Outperformance (PVX, PWE, ERF, BTE, PBT, MSB, SJT, TRU, WTU)
• Canadian Energy Trust Rally Stalls (AAV, PDS, PWE, BTE, ERF, PVX)

CANADIAN ENERGY TRUSTS CHART

CANADIAN ENERGY TRUSTS METRICS

Avg. Market Cap:	$3.8B
Avg. P/E Ratio:	21.3
Avg. Div Yield:	8.4%

It’s been a rough month for equity investors in general, and even income oriented investors have shared the pain of late. In fact, a look the top-10 tickerspy Indexes ranked by yield shows all but one Index declined for the week and similarly, all but one segment fell for the month ended Thursday.

Commodity-linked income plays were among the biggest losers for the period. As a whole, the Canadian Energy Trusts Index dipped more than -2% for the week ended Thursday and tumbled nearly -5% for the month. Penn West Energy (PWE) and Provident Energy Trust (PVX) fell hardest, as the pair of trusts slipped -2% for the week, but sank -5% and -7% respectively, for the month. The energy players sport yields of 9% and 11% respectively after the recent slide.

Meanwhile, the Royalty Trusts Index, another commodity linked high-yield play, dropped -3% for the week, though it only slipped by -2% for the month. Despite the Index outperforming the S&P by 4% over the past month, the sector had some noticeable losers for the period, with Torch Energy Royalty Trust (TRU) and Hugoton Royalty Trust (HGT) plunging -11% and -25% respectively. The pair of trusts yield 14% and 7% respectively, while as a whole, the Royalty Trusts Index is currently paying out an average of 9% annually, based on current values and distributions over the last year.

Elsewhere in the high-income space, yields rose after select heavyweights in the mortgage investments sector dove. As of Thursday’s close, the Mortgage Investment Stocks Index dipped nearly -2% for the week, but dropped by almost -6% over the past month. Sector giant Annaly Capital Management (NLY) dropped -5% for the month, while Capstead Mortgage (CMO) and Anworth Mortgage Asset (ANH) tumbled -8% and -11% during the same period. The trio of mortgage-REITs all sport annual yields upwards of 12%.

With share prices falling, yields have risen in the dividend space. As of this writing, the Royalty Trusts and Canadian Energy Trusts Indexes’ components yield 9% on average, while the Mortgage Investment Stocks Index yields 8.9% on average. It will be interesting to see if these sectors are able to stage a rally and where in yields in the space go from here. Investors seeking income can track the top-50 of more than 270 Indexes ranked by yield for performance trends and a suite of other metrics at tickerspy.com.

Tags: ANH, CMO, HGT, NLY, PVX, PWE, TRU