YTD Performance of Leading TSX Venture Exchange Oil and Gas

In February 2013 the TMX Group (owner of the TSX Venture Exchange) announced its TSX Venture 50, the top ranked companies on the Venture exchange based on equal weighting of the following measures: market capitalization growth, share price appreciation, trading volume and analyst coverage.

The 2013 TSX Venture 50 is comprised of ten companies from each of the following sectors: Clean Technology, Diversified Industries, Mining, Oil & Gas and Technology & Life Sciences.

The top ranked company across all five sectors for the 2013 TSX Venture 50, according to the TMX Group press release, was Africa Oil Corp. (AOI:TSXV), a Vancouver based oil and gas explorer.

Today we are taking a look at how the top ten TSX Venture Exchange oil & gas stocks (according to the 2013 TSX Venture 50) have performed year-to-date in comparison to the broad Venture exchange and crude oil.

The TSX Venture Exchange, as a whole, has taken it on the chin in 2013. It is down roughly 22% year-to-date. However, the underlying commodity for oil and gas stocks is crude, which is up approximately 13% in 2013. Those two metrics will be our determining factors in establishing whether these Canadian oil and gas stocks have performed relatively well so far in 2013.

Given that one metric is down substantially while the other is up a fair amount, a break even so far on the year is satisfactory, and anything above that is strong performance. With that said, if any of the TSX Venture Exchange top 10 oil and gas stocks are up more than 13% year-to-date (crude’s increase), that is exceptional performance and deserving of recognition. So, with that in mind, let’s get started.

TSX Venture Exchange Top 10 Oil and Gas Stocks(according to the TSX Venture 50)Performance YTD:

Africa Oil Corp (AOI:TSXV) – TSX Venture 50 top ranked company across all sectors: 0% (roughly) gain on the year – satisfactory share price performance year-to-date.

Petroamerica Oil Corp. (PTA:TSXV): -9% (roughly) decline in stock price year-to-date. Outperforming the TSX Venture Exchange, but trailing crude gains substantially. Modestly poor share price performance year-to-date.

Iona Energy (INA:TSXV): -5.5% (roughly) decline in stock price year-to-date. Strongly outperforming the TSX Venture Exchange, but trailing crude gains substantially. Modestly poor share price performance year-to-date.

Donnycreek Energy (DCK:TSXV): -26% (roughly) decline in stock price year-to-date. Underperforming the TSX Venture Exchange and trailing crude gains substantially. Poor share price performance year-to-date.

Mart Resources (MMT:TSXV): -16% (roughly) decline in stock price year-to-date. Outperforming TSX Venture Exchange, but trailing crude gains substantially. Modestly poor share price performance year-to-date.

WesternZagros Resources Ltd. (WZR:TSXV): 37% (roughly) increase in stock price year-to-date. Substantially outperforming both the TSX Venture Exchange and the price of crude in 2013. Exceptional share price performance year-to-date.

Manitok Energy Inc. (MEI:TSXV): -6.5% (roughly) decrease in stock price year-to-date. Outperforming the TSX Venture Exchange, but trailing crude gains on the year. Modestly poor share price performance year-to-date.

Lynden Energy Corp. (LVL:TSXV): -2% (roughly) decline in stock price year-to-date. Outperforming the TSX Venture Exchange substantially but trailing crude price gains on the year. Satisfactory share price performance year-to-date.

Eaglewood Energy inc. (EWD:TSXV): -40% (roughly) decline in stock price year-to-date. Significantly underperforming the TSX Venture Exchange and the price of crude in 2013. Very poor share price performance year-to-date.

Seven of the ten TSX Venture 50 oil and gas stocks are outperforming the exchange, which certainly speaks well to the selection process. However, only one out of the ten TSX Venture 50 oil and gas stocks is outperforming crude’s 13% gain year-to-date. This tells us that in an environment of uncertainty, when risk tolerance is low, juniors are highly unlikely to match the performance of the  commodity they are exploring for (same results can be seen with junior gold stocks in relation to bullion prices).

Top performer:WesternZagros Resources Ltd. (WZR:TSXV) – up approximately 37% YTD.

The average return for these ten Canadian oil and gas stocks year-to-date is -12.6%. That tells you what kind market we have been in in 2013.

All the best with your investments,

Pinnacle Digest

* Click here to view the TSX Venture 50 selection announcement made by the TMX Group.

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