Month-to-month Dividend Inventory In Focus: InPlay Oil Corp.

Printed on July fifteenth, 2025 by Aristofanis Papadatos

InPlay Oil (IPOOF) has two interesting funding traits:

#1: It’s providing an above-average dividend yield of 11.1%, which is greater than 9 occasions the common dividend yield of the S&P 500.

#2: It pays dividends month-to-month as an alternative of quarterly.

Associated: Checklist of month-to-month dividend shares

You may obtain our full Excel spreadsheet of all month-to-month dividend shares (together with metrics that matter like dividend yields and payout ratios) by clicking on the hyperlink under:

The mixture of an above-average dividend yield and a month-to-month dividend makes InPlay Oil a pretty choice for particular person traders.

However there’s extra to the corporate than simply these components. Maintain studying this text to be taught extra about InPlay Oil.

Enterprise Overview

InPlay Oil is an oil and fuel exploration and manufacturing firm centered on growing mild oil and pure fuel property in Alberta, primarily concentrating on the Cardium and Stomach River formations.

The corporate combines horizontal drilling, enhanced oil restoration, and infrastructure optimization to maximise effectivity and returns.

In 2024, InPlay Oil posted common manufacturing of 8,712 barrels of oil equal per day, with 58% of the output attributed to crude oil and pure fuel liquids (NGLs). The corporate is the most important Cardium oil producer and is headquartered in Calgary, Canada.

As an oil and fuel producer, InPlay Oil is extraordinarily delicate to the boom-and-bust cycles of the oil and fuel trade. It has incurred losses in 5 of the final 10 years and has exhibited a markedly risky efficiency report.

In 2015, it incurred extreme losses attributable to a steep lower within the costs of oil and fuel. The corporate initiated a dividend solely in late 2022.

However, InPlay Oil has some benefits in comparison with well-known oil producers. Most oil and fuel producers have been struggling to replenish their reserves because of the pure decline of their producing wells.

Supply: Investor Presentation

InPlay Oil is the best oil and fuel producer in Cardium, which is the most important pool of sunshine oil in Western Canada. The massive scale on this extremely prolific space creates economies of scale and bodes effectively for future manufacturing progress.

Within the first quarter of this 12 months, InPlay Oil posted an 8% lower in its manufacturing over the prior 12 months’s quarter. Given additionally the impact of a major lower within the common realized value of oil, the adjusted funds circulation per share of the corporate declined 31%, from $0.13 to $0.09.

In April, InPlay Oil accomplished the acquisition of Pembina Cardium, which is anticipated to create greater than $15 million in annual synergies and enhance the annual free funds circulation per share by 40%. Due to this extremely accretive acquisition, we anticipate InPlay Oil to develop its funds circulation per share from $0.34 in 2024 to $0.75 this 12 months.

In reference to the worldwide enterprise panorama for oil and fuel producers, OPEC offered robust assist to the value of oil through deep manufacturing cuts since 2021 however this technique approached its limits final 12 months.

The U.S., Canada and Brazil, which don’t belong to the cartel, have been rising their manufacturing and thus they’ve been gaining market share from OPEC.

This led many OPEC members, which depend on oil gross sales to fund their authorities budgets, to grow to be dissatisfied with their lowered manufacturing quotas.

Angola exited OPEC initially of final 12 months. In consequence, in April, OPEC started to unwind its manufacturing cuts, with a purpose to boost its output by 2.2 million barrels per day till the top of 2026. As this strategic shift of OPEC is prone to lead to a world surplus of oil, the value of oil has declined this 12 months.

However, it has remained above common and thus InPlay Oil is prone to stay extremely worthwhile this 12 months, assisted additionally by the aforementioned acquisition.

Progress Prospects

InPlay Oil has posted one of many highest reserve progress charges in its peer group over the past decade.

Supply: Investor Presentation

Due to a robust report of worthwhile acquisitions, InPlay Oil has grown its manufacturing per share by 255% over the past decade and it has greater than doubled its proved plus possible reserves over the identical interval.

Administration has offered steering for 15% progress of manufacturing per share and 16% progress of reserves per share in 2025. Given additionally the confirmed means of the corporate to amass worthwhile property and reap nice synergies from them, we anticipate 5% progress of funds circulation per share over the following 5 years.

However, as an oil and fuel producer, InPlay Oil is weak to the wild swings of the costs of oil and fuel. The corporate posted report earnings per share in 2021 and 2022 because of the restoration of worldwide oil consumption from the pandemic and the onset of the battle in Ukraine, which led the costs of oil and fuel to surge to a 13-year excessive in 2022.

Nonetheless, now that the worldwide oil market has absorbed the affect of the Ukrainian disaster and OPEC has begun to unwind its manufacturing cuts, the value of oil has moderated.

In consequence, the funds circulation per share of InPlay Oil have decreased from an all-time excessive of $3.00 in 2021 and $2.61 in 2022 to $0.34 in 2024. We anticipate funds circulation per share of roughly $0.75 this 12 months.

InPlay Oil has an honest stability sheet. Its curiosity expense consumes 37% of its working earnings whereas its internet debt is $152 million, which is 77% of the market capitalization of the inventory. Underneath regular enterprise situations, the corporate will not be prone to have any downside servicing its debt.

However, within the occasion of a extreme and extended downturn, InPlay Oil could face some monetary stress attributable to its considerably leveraged stability sheet, which has resulted from the acquisitions of the corporate.

Dividend & Valuation Evaluation

InPlay Oil is at the moment providing an above-average dividend yield of 11.1%, which is greater than 9 occasions the 1.2% yield of the S&P 500. The inventory is an fascinating candidate for earnings traders, however they need to remember that the dividend is way from secure because of the dramatic cycles of the costs of oil and fuel.

InPlay Oil has a excessive payout ratio of 105%, which is unsustainable over the long term. However, because of its promising progress prospects, the corporate will not be prone to reduce its dividend sharply beneath the prevailing oil and fuel costs.

In reference to the valuation, InPlay Oil is at the moment buying and selling for 9.5 occasions its anticipated funds circulation per share this 12 months. Given the excessive cyclicality of the corporate, we assume a good price-to-funds circulation ratio of 9.0, which is a typical mid-cycle valuation stage for oil producers.

Subsequently, the present funds circulation a number of is increased than our assumed honest price-to-funds circulation ratio. If the inventory trades at its honest valuation stage in 5 years, it’s going to incur a 1.0% annualized drag in its returns.

Considering the 5.0% annual progress of funds circulation per share, the 11.1% present dividend yield but in addition a 1.0% annualized headwind of valuation stage, InPlay Oil may provide a 12.1% common annual whole return over the following 5 years.

The anticipated return alerts that the inventory is an efficient long-term funding, regardless that now we have handed the height of the cycle of the oil and fuel trade.

Last Ideas

InPlay Oil has been thriving since 2021 because of a great surroundings of above-average oil costs. The inventory is providing an above-average dividend yield of 11.1%, albeit with a excessive payout ratio of 105%. Given its promising progress prospects and its affordable valuation, the inventory seems engaging.

However, the corporate has confirmed extremely weak to the cycles of the costs of oil and fuel. In consequence, it’s appropriate just for affected person traders, who can endure excessive inventory value volatility.

Furthermore, InPlay Oil is characterised by low buying and selling quantity. Which means it’s arduous to ascertain or promote a big place on this inventory.

Further Studying

Don’t miss the assets under for extra month-to-month dividend inventory investing analysis.

And see the assets under for extra compelling funding concepts for dividend progress shares and/or high-yield funding securities.