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Josh Young

 
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  • Update: Brutal Texas Dallas Fed Numbers [View article]
    You're welcome. I'll point out that my analysis was accurate in terms of Texas's economy slowing down more than everyone was predicting (except JP Morgan, and even they only halfway said it), despite a lack of data beyond oil price movements. I think the investment implication here is to underweight economically sensitive investments. Personally I'm shorting La Quinta...
    Jan 27, 2015. 07:05 PM | Likes Like |Link to Comment
  • BreitBurn Energy Partners: Making Sense Of The 20%+ Rally [View article]
    Look at the forward curve, its not down that much. For example, dec 2016 wti is only down $3 since December 16th
    Jan 27, 2015. 11:21 AM | 2 Likes Like |Link to Comment
  • BreitBurn Energy Partners: Making Sense Of The 20%+ Rally [View article]
    Why own HK and SD? They have less stable production bases than BBEP, less hedging in place, and less certain asset bases
    Jan 27, 2015. 11:12 AM | 4 Likes Like |Link to Comment
  • Do You Believe Me Now? [View article]
    Its going to be hard for the US economy and market to do well with one of its biggest states, Texas, dragging along. Did you see the hugely disappointing Dallas Fed numbers that came out yesterday? http://seekingalpha.co... - Huge surprises to the downside
    Jan 27, 2015. 11:05 AM | 12 Likes Like |Link to Comment
  • Oil: The Biggest Hairiest Guess Out There? [View article]
    Great article. I agree that the majors don't seem to be pricing in the current low oil price. And that it is important to look at the fundamentals of businesses and see how they have changed before investing. In particular, I liked this:

    "the current environment presented "the opportunity of a lifetime." Really? Without knowing the effect of oil prices on company earnings? Buyer beware"

    It made me think of my short thesis on La Quinta (LQ). How is it possible for investors to be buying the stock of a hotel company that has 50% of its hotels in places like Texas without evaluating the likely economic impact of the drop in oil on the company's cash flow?
    Jan 26, 2015. 10:37 AM | 2 Likes Like |Link to Comment
  • Kinder Morgan Buys Harold Hamm's Hiland Partners - Should Continental Have Benefited? [View article]
    Interesting, can you please share where you found that information?
    Jan 24, 2015. 03:40 AM | Likes Like |Link to Comment
  • Kinder Morgan Buys Harold Hamm's Hiland Partners - Should Continental Have Benefited? [View article]
    Chancer, I don't think enough details were disclosed to figure that out. My suggestion to KMI shareholders is to ask management about it. Understanding contract duration and pricing (especially comparative pricing vs other contracts in the Bakken) will be helpful.

    There is another risk for KMI, which is that Continental could turn around and ask for lower rates once this deal closes. Contracts or not, lower rates are being negotiated and agreed to by midstream and service companies across the oil and gas space. This happened in 2009. It benefits both parties by preserve or enhancing volumes, but could be negative if the price paid for the pipeline was set based on no reduction in rate.
    Jan 23, 2015. 03:37 PM | 1 Like Like |Link to Comment
  • Kinder Morgan Buys Harold Hamm's Hiland Partners - Should Continental Have Benefited? [View article]
    Charles, that may be true but is risky with levered companies. The risk is that the stock could fall much further and then be bought out, with the shareholders losing out in the end, similar to what happened with HLND.

    With LQ, I think its exactly that, Blackstone and management are aggressively selling at ~$20, which along with fundamental reasons makes me interested in shorting it.
    Jan 23, 2015. 02:35 PM | Likes Like |Link to Comment
  • Kinder Morgan Buys Harold Hamm's Hiland Partners - Should Continental Have Benefited? [View article]
    I have been on a board as well. Frequently board members will only serve on the board of one company active in either a particular region and/or industry, in order to avoid even perceived conflict. I would argue this is obviously not cut and dry, as this was a prior subsidiary of the company and he was the chairman of both boards!

    I am not asserting anything about legality. I am simply suggesting that the question be asked.
    Jan 23, 2015. 02:21 PM | Likes Like |Link to Comment
  • Kinder Morgan Buys Harold Hamm's Hiland Partners - Should Continental Have Benefited? [View article]
    Its weird no one has been talking about this...
    Jan 23, 2015. 01:54 PM | 1 Like Like |Link to Comment
  • Kinder Morgan Buys Harold Hamm's Hiland Partners - Should Continental Have Benefited? [View article]
    Charles, thanks for the comment. The problem is that Highland was a public company and it got bought out for a fraction (1/20 !!!) of its ultimate resale price by Hamm, its Chairman.

    If you own CLR and its stock falls, it would appear there would be a risk that he might do the same thing. How would you feel if oil prices stayed low, CLR fell to lets say $10 per share, and he bought it out for $20. Then in a few years, oil prices went back up and he resold it to a PE firm or oil major for the equivalent of $80...

    I'm not saying the above will happen, but the equivalent DID happen to Hiland unitholders.

    I've gotten more interested in these types of conflicts recently. See La Quinta, where management is claiming no exposure to oil prices while they dump their stock. Despite 50% of the hotels being in oil producing states like Texas and North Dakota! That type of occurrence doesn't seem to me to be a good setup for long term outperformance.
    Jan 23, 2015. 01:33 PM | 1 Like Like |Link to Comment
  • Kinder Morgan Buys Harold Hamm's Hiland Partners - Should Continental Have Benefited? [View article]
    While they are separate companies, being a CEO and a board member involves fiduciary duties. I think its an interesting question how those duties were fulfilled, particularly considering the huge stakes.

    Ironically it might have been more lucrative for Hamm to have had Continental buy Hiland in 2009. Imagine how much CLR stock would go up if it was getting $2.5 billion in the door today. With his large CLR stake, he might have made more than $2.35 billion mark to market on his CLR position. Obviously lots of "might haves" versus $2.5 billion in his pocket. But it is another consideration.
    Jan 23, 2015. 01:23 PM | 2 Likes Like |Link to Comment
  • Morgan Stanley Sees Oil Exposure Risk, Lowers La Quinta's Price Target [View article]
    Thanks Kay. Can you talk about why you own puts?
    Jan 23, 2015. 12:14 PM | Likes Like |Link to Comment
  • Cheniere Energy: A Scary Midstream Stock To Avoid [View article]
    Very interesting, thorough writeup. Have you thought about what you might be missing? Seth Klarman has his reputation for a reason...
    Jan 22, 2015. 08:50 PM | 3 Likes Like |Link to Comment
  • Profit From The Oil Price Crash And Follow Blackstone: Short La Quinta Holdings [View article]
    Cramer and thestreet.com pumping it? LQ hotel rates certainly aren't at 52 week highs!
    Jan 22, 2015. 05:36 PM | Likes Like |Link to Comment
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