Seeking Alpha
View as an RSS Feed

Ron Hiram  

View Ron Hiram's Comments BY TICKER:
Latest  |  Highest rated
  • A Closer Look At Plains All American Pipeline's Q3'14 Distributable Cash Flow [View article]
    Hard to answer this in a vacuum - the answer requires understanding how your entire portfolio is allocated to assets of different risk classes, the composition and volatility of your income-producing assets, how sensitive you are to a current yield reduction (from PAA's 4.86% to PAGP's 2.85%), whether/how you plan to make up for the foregone yield, your ability to absorb additional risk that come with the GP's prospects for faster distribution growth and capital appreciation. Other factor to consider: a) the lower level of liquidity in the GP units than in the underlying MLPs; b) while PAGP should provide superior growth, less dilution and better alignment of your interests with management's, you may be too concentrated in MLPs for your yield producing investments. If that's the case, there are more non-MLP alternatives to PAGP's 2.86% yield than to PAA's 4.86% yield.
    Nov 21, 2014. 09:05 PM | Likes Like |Link to Comment
  • A Closer Look At Energy Transfer Partners' 3Q'14 Distributable Cash Flow [View article]
    ETE will, at some point, drop down its interest in the Bakken Pipeline to ETP (which is already a partner and will see its stake increase) and/or SXL (which currently has no interest in this pipeline).
    Nov 21, 2014. 08:50 PM | Likes Like |Link to Comment
  • A Closer Look At Energy Transfer Partners' 3Q'14 Distributable Cash Flow [View article]
    Don't understand what are the "various contractions" you refer to.
    Nov 21, 2014. 08:47 PM | Likes Like |Link to Comment
  • A Closer Look At Energy Transfer Partners' 3Q'14 Distributable Cash Flow [View article]
    KMI-type rollup is highly unlikely for Energy Transfer based on Kelcy Warren's response to a similar question. See http://seekingalpha.co...
    Nov 21, 2014. 08:46 PM | Likes Like |Link to Comment
  • A Closer Look At Williams Partners' Q3 '14 Distributable Cash Flow [View article]
    I did not cover ACMP.
    Nov 11, 2014. 09:54 AM | Likes Like |Link to Comment
  • Preliminary Review Of Kinder Morgan Energy Partners' 3Q'14 Results [View article]
    Divide yield by 2. I didn't adjust for the 2:1 split. Apologies
    Oct 24, 2014. 01:02 AM | Likes Like |Link to Comment
  • Preliminary Review Of El Paso Pipeline Partners' Results For 3Q 2014 [View article]
    Yes, you should divide by 2. I didn't adjust for the 2:1 split. Apologies
    Oct 24, 2014. 12:58 AM | Likes Like |Link to Comment
  • A Closer Look At Targa Resources Partners' 2Q14 Distributable Cash Flow [View article]
    Transaction appears ill-timed. Price based on weighted average prices of APL and TRP units during the 15 trading days ending October 3, 2014 - just before the bottom fell out of energy stocks and MLPs.
    Oct 14, 2014. 09:14 AM | Likes Like |Link to Comment
  • A Closer Look At Williams Partners' Q2 '14 Distributable Cash Flow [View article]
    Your math seems correct, but I would word the conclusion differently. It is the ACMP unitholders that will receive lower distributions when they become WPZ unitholders (compared to what they had been previously been receiving). WPZ unitholders who did not also own ACMP will see no change resulting from the merger.
    Sep 20, 2014. 02:55 PM | Likes Like |Link to Comment
  • A Closer Look At Boardwalk Pipeline Partners' Q2'14 Distributable Cash Flow [View article]
    Split does not change the yield.
    Aug 28, 2014. 01:51 PM | Likes Like |Link to Comment
  • A Closer Look At Boardwalk Pipeline Partners' Q2'14 Distributable Cash Flow [View article]
    Agree. On the other hand, I told you to avoid it when it was $24.
    Aug 27, 2014. 08:08 AM | Likes Like |Link to Comment
  • A Closer Look At Suburban Propane Partners' Q3 FY14 Distributable Cash Flow [View article]
    I doubt it. In any event, volumes in the fourth quarter of the fiscal year are much lower than in the first two quarters, so even if margins increase the effect will be relatively muted due to the lower volumes.
    Aug 26, 2014. 04:06 PM | Likes Like |Link to Comment
  • A Closer Look At Suburban Propane Partners' Q3 FY14 Distributable Cash Flow [View article]
    Due to time constraints, probably not.
    Aug 26, 2014. 04:00 PM | Likes Like |Link to Comment
  • A Closer Look At Energy Transfer Partners' Q2'14 Distributable Cash Flow [View article]
    Hard to answer this in a vacuum - the answer requires understanding how your entire portfolio is allocated to assets of different risk classes, the composition and volatility of your income-producing assets, your ability to absorb losses, how sensitive you are to a 4% yield reduction (from ETP's 6.6% to ETE's 2.6%), whether/how you plan to make up for the foregone yield, etc. Another factor to consider is that while ETE should provide superior growth, less dilution and better alignment of your interests with management's, you may be too concentrated in MLPs for your yield producing investments. If that's the case, there are more non-MLP alternatives to ETE's 2.6% yield than to ETP's 6.6% yield.
    Aug 18, 2014. 03:05 AM | Likes Like |Link to Comment
  • A Closer Look At Plains All American Pipeline's Q2'14 Distributable Cash Flow [View article]
    DCF per unit is a measure I use to evaluate whether total DCF generated is growing or contracting, not to calculate DCF coverage. In the case of PAA's 2Q14 results, DCF per LP unit was $1.00 and distributions per unit were $0.65. But, as my article points out, DCF coverage was 1.07 (i.e., not 1/0.65). This reflects $344 million in total distributions (of which $110 million in GP IDRs, not $119 as you calculate) vs. $367 million of total DCF. So 367/344 = 1.07x

    MLPs' methods of determining DCF and DCF coverage differ. KMP, for example, deducts the general partner’s portion of net income in deriving DCF. It thus adopts a narrow definition, one that includes only that portion of DCF that is attributable to limited partners. This is the approach you seem to prefer. The more common and broader definition of coverage (e.g., PAA) is one whose numerator is total DCF (available to both LPs and GP) and whose denominator is the total of all distributions made to all the stakeholders, including the general partner. DCF, DCF growth and DCF coverage as computed using the narrow approach are not consistently lesser or greater than they would have been had the broader definition been used. They are just different.

    The brokerage analysts' calculation you refer to is as follows: $344m total distributions, less $110m IDRs, less $5m GP's 2% stake = $229m distributed to LPs. Divide $229m by the average 367m units outstanding = $0.62.
    Aug 17, 2014. 02:12 PM | 1 Like Like |Link to Comment
COMMENTS STATS
251 Comments
80 Likes