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Ron Hiram  

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  • A Closer Look At Plains All American Pipeline's Q3'14 Distributable Cash Flow [View article]
    PAA’s assets are located throughout North America in major crude oil production & liquids-rich areas, as well as inland and coastal terminal & interchange locations. It is therefore positioned to transport imported as well as domestically produced oil. PAA noted in its 2013 10-K that "While expected to decline, imports of foreign crude oil and other petroleum products are still expected to play a major role in achieving a balanced U.S. market on an aggregate basis. However, because of the substantial number of different grades and varieties of crude oil and their distinguishing physical and economic properties and the distinct configuration of each refinery’s process units, significant logistics infrastructure and services are required to balance the U.S. market on a region by region basis". PAA's infrastructure enables such balancing.
    Jan 11, 2015. 09:11 AM | Likes Like |Link to Comment
  • A Closer Look At Targa Resources Partners' 3Q'14 Distributable Cash Flow [View article]
    Targa recently reaffirmed that 2015 distributions will grow by 11-13% for NGLS and by 35% for TRGP. In 2015 it expects to achieve 1x distribution coverage with gas at $3.75 per MMBtu and with oil at $60 per barrel. No mention was made of expectations for 2016 and beyond. Given current prices of ~$2.93 per MMBtu and $48.80 per barrel, coverage may fall below the 1x threshold in 2015. There are numerous examples of MLPs that have not cut distributions despite negative (i.e., below 1x) coverage. I expect Targa will meet its distribution growth targets in 2015 even if coverage falls below 1x. I do not expect distribution cuts, at least not until we have several quarters of negative DCF coverage behind us. How many quarters depends on the magnitude of the drop in DCF coverage. As of now, my best guess is that it will not happen in 2015.
    Jan 11, 2015. 08:40 AM | Likes Like |Link to Comment
  • A Closer Look At Targa Resources Partners' 3Q'14 Distributable Cash Flow [View article]
    Targa is highly concentrated in the Bakken, where it is more expensive to extract oil & to transport it to the market. By more expensive I mean relative to the Texas shale formations (Eagle Ford, Permian) and Marcellus/Utica. So the Bakken, and for similar reasons the Canadian and midcontinent shale formations, are likely to be the first to see production cuts in response to lower oil prices. The larger price drop for NGLS vs. for example EPD, MMP, and ETP reflects this. Having said that, I do not believe the dividend is under threat in the short term. Longer term (>1 year), dividend growth could be adversely impacted.
    Dec 2, 2014. 11:24 AM | 2 Likes Like |Link to Comment
  • A Closer Look At Plains All American Pipeline's Q3'14 Distributable Cash Flow [View article]
    The major competitor to the proposed Keystone XL pipeline intended to transport Canadian oil to the Gulf Coast via Cushing is KMI’s Trans Mountain pipeline. PAA said it was evaluating the opportunity to connect to the Keystone XL and the TransCanada East systems.
    Nov 21, 2014. 09:31 PM | Likes Like |Link to Comment
  • 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
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