Seeking Alpha
What is your profession? ×
Profile| Send Message|
( followers)

Tortoise North American Energy Corp. (NYSE:TYN) is a closed end fund traded on the New York Stock Exchange. The fund was launched in 2005 and as of February 1, 2012, sold at 1.98% discount from net asset value. TYN is a non-diversified closed end fund focused primarily on investing in equity securities of companies in the energy sector with their primary operations in North America, TYN invests primarily in Master limited Partnerships and their affiliates, but may also include Canadian royalty and income trusts. TYN seeks a high level of total return with an emphasis on current distributions paid to stockholders.

TYN does achieve these goals and pays a high return, which account for the almost negligible discount from net asset value. Even today, many closed end funds trade based upon their distribution, with premium or discount being inconsequential in the eyes of income hungry investors. Per share figures for the fiscal year ending November 30, 2011, are as follows:

Payout percent


Leverage as percent of total assets


Total distributions from investments


Operating expenses before leverage costs


Distributable cash before leverage costs


Distributable cash flow


As can be seen TYN pays a healthy dividend which investors, starved for return, seek desperately.

Fund assets are fairly distributed, with the largest categories being as follows:

Crude/refined product pipelines


Natural gas pipelines


Natural gas gathering/processing


Oil and gas production


TYN has kept its promise over the years and has delivered consistent income. It does offer an alternative to a broad fixed income portfolio but assumes the risk of being involved in a very specific sector.

It does seem to be a good investment for those seeking high return with faith in petroleum based energy products. With the vast new discoveries of natural gas, I tend to wonder. I would personally have more faith buying something like Petroleum & Natural Resourced (NYSE:PEO), which invests directly in the producing companies but offers a smaller yield.

Disclosure: I am long TYN, PEO.