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Canadian Oil Sands: Evaluating A Takeover By A Fellow Syncrude Partner

Along with the energy sector as a whole, shares of Canadian Oil Sands (OTCQX:COSWF) have fallen significantly in recent months. The firm's position as a high-cost and marginal producer leaves its share price highly sensitive to fluctuations in oil prices as it has a selling prices have a material impact on the firm's profitability. Over the past six months, shares of this Calgary-based producer have fallen by nearly 62% as falling oil prices have made the firm's share of the Syncrude venture, which is Canadian Oil Sands' primary asset, less valuable on an economic basis. As a result of weak oil prices, Canadian Oil Sands reported weak full-year 2014 earnings that disappointed investors and included significant cash outflows from operations.

Additionally, in light of a weakened 2015 outlook, Canadian Oil Sands intends to payout a lower dividend than in 2014 and than what was guided for in December. However, despite… Read More …