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Energy trusts (SDT, PER, SDR) all take hits after announcing dividend and production cuts last...

  • Friday, February 1, 1:36 PM ET
    Energy trusts (SDT, PER, SDR) all take hits after announcing dividend and production cuts last night (I, II, III), and Raymond James does not pass "Go," downgrading the group to Sell from Buy. These new trusts are misunderstood, says one trader long the names. The wells are still getting drilled and there's going to be volatility in production volumes. They're cheap by any metric and - unlike MLPs - they're debt-free, having no need to issue debt (or shares) to replace depleting assets.
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This news story has 13 comments:

  •  
    If I didn't already have as much as I wanted, I'd be buying more SDR.
    1 Feb, 01:41 PM Reply Like
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    Separately, analysts at Wunderlich downgraded shares of SandRidge Mississippian Trust II from a buy rating to a hold rating in a research note to investors on Monday, November 5th. They now have a $22.00 price target on the stock, down previously from $24.00.
    Drilling is up, actual production had been down, but oil prices for previous quarter barely broke $80. Now oil prices breaking $100, sounds like RJ stock price manipulation to me, already a bargain and know next quarter will be very profitable.
    (Not sure why author came up with a Nov 5 downgrade mention)
    http://bit.ly/11pnOQj
    1 Feb, 02:01 PM Reply Like
  •  
    The author of the attached 'new trusts are misunderstood' document highlights his/her belief that these trusts are cheap. "Cheap" is a cheap term in this case. The author's discussion offers no analysis of the potential future production stream, an assumption on energy prices, and ultimately no statement of what valuation should be, in his/her opinion. Do the work or find someone who has before you commit your funds. Caveat Emptor.
    1 Feb, 02:06 PM Reply Like
  •  
    Stopped out today. Kept divs in cash. May buy back in at lower price.
    1 Feb, 02:51 PM Reply Like
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    SDT is down only $.50. It's still on an uptrend that began in November when the stock hit $14.80. SDT had been going down steadily since it reached a high in February 2012. The pattern of declining dividends began at that time. While I have been interested in SDT, I do not buy a stock when the price and/or dividends have been on a steady decline. Whether now is a good time to buy will be revealed when the company announces its next dividend.
    1 Feb, 04:23 PM Reply Like
  •  
    SD getting almost as much bad publicity and earnings as CHK. SD spending money to develop Mississippian wells - bringing in power that is not out there in the OK/KS grasslands. The oil goes to Cushing, and that price is not $100 - but the Cushing price should improve with pipeline construction and enhancement. Problem is, more lines bringing crude to Cushing...
    All in all, may be a good time to buy - as it looks like only a fool would touch them.
    1 Feb, 04:46 PM Reply Like
  •  
    SD is trying my patience//////////////... up daily and not even that can give it a lift.......beyond dead money in my portfolio
    1 Feb, 05:44 PM Reply Like
  •  
    To all who have been knocking CHK and SD I suggest you read the following article re the consequences of hedge fund takeover of these stocks:

    http://reut.rs/14GvIEN
    2 Feb, 11:18 AM Reply Like
  •  
    Elliot Gue did a great work up on PER, it's posted on SA. Search it out, learn all you need to know about PER.
    3 Feb, 08:01 AM Reply Like
  •  
    Bought PER Wed. Feb. 6 @17.71
    6 Feb, 10:47 AM Reply Like
  •  
    Nice.
    6 Feb, 12:51 PM Reply Like
  •  
    i''m an ole lady not willing to throw good USA $ after unsafe $. I'll stay w/SD for now.
    3 Feb, 11:33 AM Reply Like
  •  
    These trusts are volatile but if you hold on they will come back.

    Income is too hard to find for them to stay down long tern, especially with more retail buyers moving into equities.
    5 Feb, 12:10 PM Reply Like
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