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Too Many Questions Remain To Buy Hugoton Royalty Trust

Hugoton Royalty Trust (NYSE:HGT) is trading at approximately half of its 2012 high and a third of its 2011 high due to falling natural gas prices and legal issues. The units have an attractive annual distribution yield of 10.8% and investors get their distributions monthly but how stable is the distribution going forward and can it support a $7.59 unit price?

Hugoton Royalty Trust Overview

Hugoton Royalty Trust was formed in 1998 with XTO Energy Inc. as grantor and NationsBank, N.A., as trustee. Bank of America, N.A., is the successor to NationsBank, N.A. The trust has claim to 80% of net profits generated from working interests from natural gas producing properties in Kansas, Oklahoma and Wyoming. XTO Energy,...

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