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arbtrdr

arbtrdr
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  • The Kinder Morgan Conundrums - Part II [View article]
    Everything that comes out of an IRA is taxed as ordinary income! Thus it does not matter capital gains or dividends. If you bought WalMart 40 years ago at .12 and sell it today at $75 the entire amount is ordinary income. The theory of an IRA is a retirement your income wil be lower and thus ordinary income rate possibly lower than even the rate for dividends.

    The reason for KMR inside an IRA is no K-1 and the possibility of UBTI and recapture of depreciation on the sale.

    Good article. Agree KMR selling at significant discount makes no sense
    Apr 29 12:46 AM | Likes Like |Link to Comment
  • Magnum Hunter's Eureka Pipeline: A Fantastic Asset Fairly Valued [View article]
    As it stands Eureka is worth something close to $1B. The problem with the projections for over 1Bcf a day is that would require a huge capital expenditure. With MHR already byrning through many millions of dollars a year where would another $500M come from to expand Eureka on top of the capex they are already spending.

    MHR built Eureka to provide takeaway from its wells. They are not a pipeline company and in fact the pipe puts a drag on the rest of the company as its ROI is significantly lower. Its for sale - plain and simple.
    Apr 27 04:56 PM | 1 Like Like |Link to Comment
  • MLP GP Distribution Growth Tells Me They Are Undervalued [View article]
    OK - How does owning the MLPs w/o GPs - BPL, EPD, MWE for example compare to owning the GP or the underlying MLP?

    Great analysis and should be clear to most everyone.

    ARB
    Apr 27 09:44 AM | 1 Like Like |Link to Comment
  • MLP Suspends Distributions - Second MLP To 'Blow Up' In 2014 [View article]
    Josh - Let's try this one more time. EROC cut its distribution in November of 2013 from .41 to .025! They cut again in August of 2013 fron .22 to .15. The elimination of the distribution this week was required by the agreement on the sale of midstream assets to RGP. Again OLD NEWS.

    EROC has moved up and down by a large % some 12 times in recent months. Getting some $1+B from RGP will stabilize but what wil the remainder of EROC be worth? $2? $4? $6? VERY hard to tell and that is why large % movements do not mean much. MWE down over $1 today - yawn because it sells for over $60. Under $5 stock have historically have large % price movements. Their beta is statistically almost twice stcoks selling for over $25.
    Apr 24 01:39 PM | 2 Likes Like |Link to Comment
  • MLP Suspends Distributions - Second MLP To 'Blow Up' In 2014 [View article]
    You can continue to put out anything you want without really needing to suppport your position. Atlas has already put out an early press release on guidance and announced a profitable processing plant that certainly would not have been announced until the earnings call. The attack by Hedgeye will be interesting and IMO probably go quietly go away.

    EROC has a history of distributions being cut in both 2009 and 2011 so really nothing new. Selling of the midstream sassets was a way to possibly survive or sell the E&P side of the business. The problem is that EROC did not "blow up" in 2014. EROC has been troubled since its formation and its distribution has gone up and down in its short history. The flaming of MLPs using such headlines are doing a disservice to the segment.
    Apr 24 10:46 AM | 6 Likes Like |Link to Comment
  • MLP Suspends Distributions - Second MLP To 'Blow Up' In 2014 [View article]
    Josh - Why write this? EROC agreed in its sale of the midstream assets not to pay out $$ this quarter. There is no new news. There was no probability of a distribution cut being priced in at under $5 because basically they were selling a huge chunk of the company and agreed to suspend. EROC was undwer capitalized and in a boom or bust sector of the market. They agreed to sell their midstream assets - all of them - to RGP in DECEMER!

    As to the company going forward - what will it look like? This is old news.
    Apr 24 08:49 AM | 5 Likes Like |Link to Comment
  • Linn Energy: A Closer Look At LinnCo's 'Dividend' [View article]
    What is the difference with the Lineco dividend regarding the classification?

    If a dividend you pay at dividend rate in the year issued. If a non-dividend payout you reduce your basis and pay at capital gains on sale. Sounds like a better deal as taxes a deferred until you sell. The article makes it sound like a bad deal when except in a few situations it would actually be good for taxpayers.
    Apr 23 10:25 AM | 6 Likes Like |Link to Comment
  • Magnum Hunter's Eureka Pipeline: A Fantastic Asset Fairly Valued [View article]
    Clayton - Selling parts of it? how would that work? You have a main pipeline and several collector laterals. MHR built the laterals to provide collection for its own wells. The main pipeline mostly feeds MWE and thus they would be interested except for the fact MWE has repeatedly said they do not want to be in the pipeline business except as necessary for its processors. Not sure there are best parts of the pipe as it is a system.

    MHR stated they were going to sell off a number of assets to provide cash and they are executing that plan. Would think the time to sell would be late 2015 after the pipe system is mostly full and the EBITDA probably doubled from today. They could also sell it with a preferential rate for their own NG/NGLs. Hmmmm.
    Apr 22 12:01 PM | 1 Like Like |Link to Comment
  • Why Not Consider This 12% Yielder As An Alternative To REITs And MLPs? [View article]
    Would agree except PSEC was in the $18 area before the financial meltdown in late 2008 and hit almost $8 in august of 2011. That volatility is really a bit larger than one would call stable. Also what will happen if we get a spike in interest rates? Would guess that most in the high yield area would have share pricing pressure due to alternative opportunities in bonds.
    Apr 22 11:01 AM | 8 Likes Like |Link to Comment
  • Top MoPay Dividend Dogs Seek 14.8% To 89.6% Net Gains In April [View article]
    The only problem with this analysis is companies paying monthly are often very very different. Comparing Realty Income with Baytex is really hard. Even comparing Baytex (conservative approach to balance sheet) to Pengrowth is comparing apples to oranges. They have a different approach to leverage.

    Last, many energy stocks and REITs are down because of interest rate fears. If you took a different time frame you can obviously get a very different picture. O has been terrible in the last year but up some 500% plus lots of dividends in the last 20 years. Same for BTE.
    Apr 22 10:37 AM | Likes Like |Link to Comment
  • Top MoPay Dividend Dogs Seek 14.8% To 89.6% Net Gains In April [View article]
    There is a cap based on the amount of tax, amount of foreign income and your AGI for the year. Anything not allowed in the current year rolls forward. There is no cap and you eventually will get every dollar back.
    Apr 22 10:32 AM | Likes Like |Link to Comment
  • Top MoPay Dividend Dogs Seek 14.8% To 89.6% Net Gains In April [View article]
    You need a new broker if TradeKing is doing that. Could not find a major broker that does it that way inside an IRA.
    Apr 22 10:30 AM | Likes Like |Link to Comment
  • Top MoPay Dividend Dogs Seek 14.8% To 89.6% Net Gains In April [View article]
    Why? You can get a tax credit when you file your 1040. Thus the 10.36% does not turn into 8.6%.
    Apr 22 10:29 AM | Likes Like |Link to Comment
  • Magnum Hunter's Eureka Pipeline: A Fantastic Asset Fairly Valued [View article]
    Good article and restates well what MHR has already said in presentations, earnings calls and at conferences. Really silly to sell at a traditional multiple of EBITDA when the volumes transportated will triple in one year and MHR said they would not do that. They stated last fall they would sell leases non central to their plan first. Another of those sales was agreed to yesterday. Actually few surprises from MHR in the last year.
    Apr 22 08:19 AM | 3 Likes Like |Link to Comment
  • The Next MLPs To Crash? Hedgeye Targets Another Pipeline MLP [View article]
    APL has a track record under the Cohens that is less than perfect. Start with an expensive and failed buyout of a pipeline in Alaska. Next move to a failed buyout/merger with a coal company in Wyoming. Move on to a system of hedging that almost put APL into bankruptcy. Recently as another posted already a writedown of the Cardinal buyout and a pushback on distribution increases. APL also certainly does have issues with POP contracts that are not going to be very profitable until ethane prices rise circa maybe 2016 or 2017.

    What may be different is Cooperman will definately push back and Hedgeye is really crappy (no apology for the word) in tweeting they are going to publish something 3 days in the future. Thus those that received the tweets got a head start to sell. Maybe this time the SEC should investigate Hedgeye instead of the MLP. Tweeting ones clients that you are going to do something is simply manipulation.
    Apr 21 05:49 PM | 5 Likes Like |Link to Comment
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