Is the SandRidge Permian Trust Considered to Be a Good Investment?


Quick Answer

In May 2015, The Motley Fool gave Sandridge Permian Trust, which trades as PER on the New York Stock Exchange, a neutral to slightly positive opinion. In July 2015, Zacks Equity Research called PER a "great value stock" with a "buy" recommendation and offered three reasons to support the rating.

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Full Answer

The Motley Fool author believed that the trust would not lose money for its investors, and might return more than the S&P 500. However, unlike other stocks, PER is a royalty trust, The Motley Fool reminded readers. The value of the trust varies with the underlying commodity, which is oil. There no new wells scheduled to be drilled in the Permian Basin, and share price is unlikely to rise. Investor income comes from royalties.

Zacks cited a low forward price/earnings ratio, a low price-to-cash flow ratio, and earnings estimate revisions that are trending positively. According to Yahoo! Finance, PER ended 2015 at $2.97, after trading over $8 earlier in the year.

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