"Harvest Energy Trust (NYSE: HTE) is exactly what we love – a company with incredible upside and hefty 'dividends' that's being ignored byWall Street," says Keith Fitz-Gerald.

The editor of Money Morning explains, "But the stock is not being ignored by the company's executives. In fact, insiders are buying like crazy. And while this by itself doesn't guarantee higher prices, it's an important indicator of things to come, especially when oil prices are destined to increase in the coming years.

"Harvest Energy is located in Calgary and functions as a Canadian royalty trust, which means its profits are funneled back to investors in the form of 'distributions.' Harvest engages in the exploration, development, production, and sale of petroleum, natural gas, and natural gas liquids in western Canada.

"And the best part is, it's been tamped down in the last two quarters. You see, management has reduced its distribution by 21%, citing volatile energy prices and the new tax rules set to take effect in Canada in 2012. It also carries a lot of debt after having consolidated purchases of other oil and gas trusts and large private producers over the last two years. The company also purchased a refinery complex – and that didn't come cheap.

"Now here's where things get really good: Plain and simple, Harvest is sitting on oil – a lot of it. Large multi-million barrel reserves, with an estimated 9.3 years of proven and probable reserves using conventional extraction techniques. It's also sitting on over 1 billion barrels of untapped oil sands.

Two of the savviest advisors around are Mark Skousen and Richard Lehmann. Both are noted experts in income investing and both have recently issued buy recommendations for the same stock.

Skousen, in his High-Income Alert, and Lehmann, in his Forbes/Lehmann Income Securities Investor, both look at Penn West Energy Energy Trust (NYSE: PWE).

Skousen explains, "The dollar continues to slide. Oil is approaching $100 a barrel, and gold, a sign of global instability, now is above $800. And the mortgage credit market continues to soften.

"All of these conditions make it difficult to profit, even in our high dividend-paying stocks. Fortunately, history is on our side. Studies show that a well-diversified portfolio of dividend-paying stocks tend to be more stable during difficult times.

"Our safest position is in oil stocks, so we are going to add another oil & gas stock to our portfolio: Penn West Energy. The trust bought out Canetic recently to create the largest oil and gas trust in North America.

"The combined trust is worth more than $15 billion and has the equivalent production of more than 200,000 barrels of oil a day. Penn West holds interests in western Canadian oil and natural gas pools, along with opportunities in oil sands, coal-bed methane, shale gas, and enhanced oil recovery.

"Penn West is paying an incredible dividend that now is about 35 cents a month, compared to 30 cents a year ago. The company's current dividend yield exceeds 13%."

"Since tax changes on Canadian trusts were announced last October, their valuation premiums have vanished," notes Gavin Graham, contributing editor to Gordon Pape's The Income Investor.

And while the advisor notes that takeover speculation alone is not a reason to buy oil and gas trusts, he says, "It would not be unreasonable to wonder if a number of foreign oil companies aren't running their numbers on some of the large Canadian trusts."

One favorite, which he calls a "blue-ribbon energy trust" is Penn West Energy Trust (NYSE: PWE) -- one of the largest oil and gas trusts listed on the Toronto and New York stock exchanges. The firm is involved in gas, light crude, heavy crude, and oil sands operations in north-eastern British Columbia, Alberta, and south-western Saskatchewan.

He notes, "Penn West converted from a corporate structure 18 months ago and therefore has a long track record of proven delivery. It is run by Murray Edwards, one of the most successful Calgary-based oil entrepreneurs. Overall, we believe Penn West offers a good combination of current income and growth potential."

Dan Frishberg, editor of The MoneyMan Newsletter and host of BizRadio 1320, is going out on the limb with some contrary positions in two out-of-favor sectors -- a U.S. housing play and a Canadian income trust.

To recall, last fall, the Canadian government changed laws regarding the way that Canadian income trusts would be taxed, which led to a marked fall-off in the entire sector. Frishberg now notes, "I've been watching the sector since prices fell dramatically in a short amount of time." And one stock in particular that he has watched is Canetic Resources Trust (NYSE: CNE), which he notes fell from $17 to around $12.

Since then, he says, it's bounced around $12 several times and it appears it's finally starting to get some traction. Indeed, he adds, "There are now rumors of private equity coming into this area as their next target. Many energy trusts might get taken public and their domiciles moved to another country, possibly the U.S."

He continues, "If that happens, many of these trusts will rocket higher." The advisor has added Canetic Resources to his income portfolio. The stock has a yield based on the current dividend of just under 15% per year and pays a monthly dividend.

In another move into an equally out of favor sector, the advisor is also going long in the housing sector. He explains, "Stocks move ahead of news -- and some of our forward looking indicators are showing that home prices may actually improve in the next few months."

Frishberg notes, "Once everyone agrees that housing is improving nationally, the stocks will have already run up in advance. From a technical perspective, we really like the homebuilders as a whole." To reduce risk, he is avoiding investing in any one particular housing stock and is buying a basket of holdings iSHARES Dow Jones U.S. Home Construction (ASE: ITB), an exchange-traded fund."

For more stock picks from the leading financial newsletter advisors, visit Steven Halpern's free daily website, TheStockAdvisors.com.

50% off isn't always a good thing! If you've been following so far, fellow Blogging Stocks contributor Sheldon Liber and I have been scratching our heads about high payout yields from energy trusts battered by the decision from the Canadian government to tax trusts. On the surface, examining the energy trusts' financials make it seem possible for them to sustain payouts at current rates, but for how long?

Well, income investors didn't have to wait long. Energy trusts shareholders will be in for a rude awakening to start the week. Last week, many notable energy trusts delivered bombshells by cutting their payouts - in a big way too!

Last Thursday, Shiningbank Energy Income Fund trimmed its distribution for the third time in the last 12 months. This only served as a prelude as a slew of cuts flew in last Friday. Enterra Energy Trust (NYSE:ENT) slashed its monthly payout by 50%. Precision Drilling Trust (NYSE:PDS) followed suit, reducing its distribution by almost 40%. Advantage Energy Income Fund (NYSE:AAV) would complete the hat trick, cutting its monthly payout by 17%.

Are you among the investors reeling from these announcements? If you feel inclined to blame the Canadian government, please take a closer look first! What are the wind-shifts in the industry outlook have caused these reductions, rather than the proposed tax levy?

Enterra Energy Trust (NYSE: ENT) closed last Friday at $8.12, up fifteen cents for the day and far above its a 52-week low of $6.68. While $1.44 would be a nice profit from that November 2006 low, it had been as high as $19.50 last January 2006.

The AOL Money & Finance Profile reads: Enterra Energy Trust trusts in the energy interred in geological strata. Through subsidiaries the trust acquires interests in petroleum and natural gas properties. Its principal operating subsidiary is Enterra Energy Corp., which explores for and produces oil, natural gas, and natural gas liquids in Western Canada (primarily in the Peace River Arch area). The trust's interests in crude oil and natural gas assets are held through Enterra Energy Corp., Rocky Mountain Acquisition Corp., and Rocky Mountain Gas Inc. Rocky Mountain Gas holds gas assets in Montana and Wyoming. The trust's proved and probable reserves are 19 million barrels of oil equivalent (boe), and its production averages 6,300 boe per day.

Earlier last week one of our readers brought ENT to my attention because James Cramer had recommended it a few months ago. I was floored when I took a brief look at the company and saw that Enterra Energy Trust is paying an 18.07% yield. That is very remarkable even to the 'untrained eye' - think novice investor. How long could that yield hold up? What is the rest of the story?

The ten-year chart above indicates that there was quite a lot of optimism about ENT the first 18 months of its public life, but that was followed by an internet bubble-type collapse from a high near $127.00 in late 1999. Its share price continued to deteriorate with from 2000 to 2002 after which it spent the last few years in a trading range between $5.00 and $10.00.

Each year Steven Halpern, editor of TheStockAdvisors.com, surveys the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is part of his 24th annual Top Picks Report.

Penn West Energy Trust (NYSE: PWE) is a top conservative idea for 2007 from income expert Richard Lehmann, editor of The Forbes/Lehmann Income Securities Investor. He explains, "I am a steadfast believer in the Canadian oil and gas trusts, despite the Canadian government's decision, on October 31, 2006, to begin taxing the trusts as regular corporations after 2010.

"Currently, the trusts pay out income to investors as dividends and are not taxed on the corporate level. In addition, these dividends are treated as qualified dividend income for U.S. investors and subject to the preferential 15% tax rate.

"Recent proposed changes in the Canadian tax law slammed all trusts and brought PWE down from $37 to a current price of $31. This brings the yield up to almost 12%. I like Penn West because it is one of the largest trusts, with over nine years of proven reserves and extensive holdings of unproven ones.

"They have four years to restructure their finances to offset the increase in taxes -- something that may not even come about if past lobbying efforts are any indication.

"Given that the current dividend represents only 63% of cash flow, the monthly dividend is safe from cuts down to a $50 a barrel price for oil. Investors are likely to sell shares of Penn West to lock-in tax losses in December, but I see price appreciation early in 2007 as investors buy in for the irresistible yield."