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  • MLP Weekly Intelligence: Catalyst Wanted [View article]
    We will be publishing a select group of Fund Xrays on Seeking Alpha, which will provide forecasted distribution growth rates associated with each portfolio, which should help investors understand the future performance of each MLP ETF, Closed End Fund and Mutual Fund. MLP portfolio managers are challenged to increase yield without taking on significant principal risk, so understanding the balance of the portfolio is more relevant today than it has been for the past three years
    Jul 1, 2015. 07:03 AM | Likes Like |Link to Comment
  • Hi-Crush Partners Is A Win For Income And Value Investors [View article]
    The risk with HCLP and EMES is that they continue to "negotiate" their take or pay contracts, which were previously positioned as guaranteed payments. They are lowering price by 30% and extending terms. If current gas and oil prices persist, they will continue to get further squeezed like all other service providers. Q2 performance will be telling as to whether these discounts are expanding. Above these specific issues is the expanding risk premiums associated with MLPs, which are lowering prices. Both management teams have suggested that the market needs to reward their distribution growth otherwise they will modify their growth plans given the high expense associated with issuing new units. Much greater risk with EMES
    Jul 1, 2015. 06:58 AM | Likes Like |Link to Comment
  • MLP Weekly Intelligence: Catalyst Wanted [View article]
    GLOG will be the higher growth vehicle as you correctly clarified
    Jun 30, 2015. 10:05 AM | 1 Like Like |Link to Comment
  • MLP Weekly Intelligence: Catalyst Wanted [View article]

    We agree the drop is accretive, but LP owners paid a higher price for the asset with greater re-contracting risk than their GP did just a year ago. GLOP is down -33.4% on a total return basis due to the expectations of slower distribution growth. Given 1.91 pa and IDR tiers, GLOP will be taking a greater share of GLOP distributions and should be the higher growth vehicle.
    Jun 30, 2015. 08:35 AM | 2 Likes Like |Link to Comment
  • MLP Weekly Intelligence [View article]
    The market certainly responds to short term commodity price changes despite their impact on the 12 month short term. However, over time, the market is adjusting to, if these current levels prevail through Q3 2015 or later, the lower growth rate for midstream MLP's which are reliant on organic projects for growth. With low commodity prices and the prospect of higher rates, it is wise to develop a portfolio which is comprised of MLPs with drop down growth along with high yielding lower growth units
    May 29, 2015. 08:14 AM | Likes Like |Link to Comment
  • MLP Weekly Intelligence [View article]
    Not all MLP midstream MLP's have reacted poorly to the adverse price conditions. Although most have no price exposure, they do have volume exposure. Each MLP has a set of assumptions about future distribution growth. If those assumptions change (or more likely mgt adjusts or comments on guidance), the current price will adjust down to reflect the higher yield associated with lower growth, which is behind the PAA and EPD reductions.

    So the key item is not current distribution coverage, but rather the future growth rates. MLPs which rely on organic growth have greater risk from lower commodity prices than those which will rely on sponsor drop down assets to drive distribution growth.
    May 28, 2015. 08:29 AM | 1 Like Like |Link to Comment
  • Tallgrass Energy GP Will Offer +20% Returns Despite Energy Weakness [View article]
    Yes, there will be no taxable income reported through at least 2017. If and when there is income, it will be reported via a 1099
    May 8, 2015. 10:29 AM | Likes Like |Link to Comment
  • Tallgrass Energy GP Will Offer +20% Returns Despite Energy Weakness [View article]
    1099's will be issued, but the company does not expect any taxable federal income prior to at least the end of 2017
    May 5, 2015. 02:01 PM | Likes Like |Link to Comment
  • Enviva Partners Offers 8.25% Yield With A Unique Set Of Biomass Assets [View article]

    presently there is 177 bps spread between GLOP and EVA and the former distributes a 1099 vs K-1 for EVA. I would agree that GLOP has more visible growth and proven EBITDA inventory, but that is the total return bet on EVA, that EVA growth will become more transparent and there is an opportunity for 50% appreciation and target yield of 5%
    May 2, 2015. 11:07 AM | Likes Like |Link to Comment
  • Enviva Partners Offers 8.25% Yield With A Unique Set Of Biomass Assets [View article]

    Enviva is focused exclusively on exporting all production to the EU and Asia markets for industrial power generation. If they need to compete in the US, as you suggest, there is much greater risk. Enviva's view is that these markets need to convert from coal, and pellet conversion is the cheapest alternative which meets the renewable guidelines.
    Apr 30, 2015. 09:00 AM | Likes Like |Link to Comment
  • MLP Weekly Intelligence [View article]

    All of the chart links are in the body of the article. Not sure why they are not expanding otherwise
    Apr 27, 2015. 04:46 PM | Likes Like |Link to Comment
  • Alerian MLP ETF Finally Admits Its 8% Expense Ratio [View article]
    When Lehman failed, they had several Agriculture ETNs, which dropped significantly in value due to the principal risk related to the bank returning the principal. Prior to this event, such a risk was not priced in to the premium. While banks are in much better shape, any future liquidity concern or Watchlist placement will lead to yield expansion for ETNs
    Mar 6, 2015. 08:31 AM | Likes Like |Link to Comment
  • MLPs Are Down 10% But This MLP Closed End Fund Maintains A Premium [View article]
    It is puzzling. First Trust filed a 13D indicating they added KED to their managed funds and UIT, which expanded the premium since early Feb. The ability for the fund to invest in private investments could be a reason, but why pay the premium now for the optionality to buy distressed and likely illiquid assets
    Mar 2, 2015. 09:10 AM | Likes Like |Link to Comment
  • Tallgrass Energy Partners Has 50% Upside After Pony Express Acquisition [View article]

    The TEP story is very transparent and the management team is executing as they have communicated. Some times it is that simple but the market often creates enough noise and uncertainty offering focused investors the ability to earn significant returns.
    Feb 22, 2015. 03:32 PM | Likes Like |Link to Comment
  • Antero Midstream Partners IPO Offers Investors Long-Term 20% Income Growth With Low Risk [View article]
    The 13D's are disclosures from the Fund sponsors which purchased at IPO price. The structure of the GP is similar to others like Columbia which just came public. The idea that a company would buy the GP and use AM to drop assets is a possibility, but only likely if AR is not able to fund expansion and cannot support distribution growth, and it would still be a very complicated transaction with questionable benefits. AM management guided to 25% growth, so such a scenario seems unrealistic. All of the new MLP structures are formed with the optionality to spin out the GP, which are structured to own the IDR's and LP majority interests. TEP recently announced plans to spin out the GP
    Feb 11, 2015. 09:25 AM | Likes Like |Link to Comment