Seeking Alpha

Neil B

Neil B
Send Message
View as an RSS Feed
View Neil B's Comments BY TICKER:

Latest  |  Highest rated
  • Is Kinder Morgan's Debt That Bad? [View article]
    CalMike, I have bought puts as a hedge against the decline in KMI. So far I have made some money. If KMI goes down big, I will make a lot more money in the puts. Unfortunately, I will lose even more money in the stock.
    Sep 24, 2015. 01:39 PM | 1 Like Like |Link to Comment
  • 4 Reasons Why Saudi Arabia Will Keep The Spigots Open Until 2018 [View article]
    There has been much talk about how long Saudi Arabian cash reserves will last. The following quote was taken from an article on CNBC.

    "Barclays wrote in a recent research note. However, 'without adjustment to the current fiscal path, and if oil prices persist at $50 per barrel, Saudi Arabia could use up its financial buffers by 2019,' the bank added."
    Sep 20, 2015. 01:12 AM | 5 Likes Like |Link to Comment
  • Why Do You Own Kinder Morgan? [View article]
    I suggest you read the following article to get a different perspective about what happens when the Chinese unload U.S. Treasuries.

    "Why China’s U.S. Treasury Sell-Off Is Good News Can Beijing’s sale of dollar reserves actually be a positive for America’s economy?"
    Sep 10, 2015. 12:21 PM | 4 Likes Like |Link to Comment
  • Linn Energy: What To Do After Friday's Massacre [View article]
    I would hold off on buying energy bonds. Many of them are beginning to sell at a discount and will likely go lower.
    Dec 1, 2014. 09:05 AM | 5 Likes Like |Link to Comment
  • Linn Energy: What To Do After Friday's Massacre [View article]
    Last year I bought LINE and lost money on it. I kept hearing that things were fine, and that the investment thesis was fine. In the meantime,the stock price kept going down. A look at the chart says this stock is a screaming sell. I think sometimes people confuse buying stocks with rooting for football teams. If you root for a football team that loses, it doesn't have to cost you anything unless you insist on betting on it. If you root for a stock you can lose an awful lot of money. I mean no disrespect to "cardinallen," but the comment is priceless. "Will hold on to the rest... done space lost about half my money anyways." What about the other half?
    Dec 1, 2014. 08:23 AM | 8 Likes Like |Link to Comment
  • Capitulation In Energy Sector Near: Accumulate These High-Yield Plays Now [View article]
    I appreciate your rational approach to what's happening in the oil markets now. However, the possibility of a major correction in the market needs to be considered. If that happens, rationality will likely yield to panic. The possibility of further significant selloffs in the stocks discussed and others like them would no longer have a relationship to the price of oil or natural gas. My major holdings are in KMP and MWE. These have not sold off like many other oil and gas related stocks. However, there is nothing preventing them from succumbing to a major market correction. The selloff in stocks such as MEMP and ARP could be significantly greater.

    Another concern is that many of the oil and gas companies are heavily leveraged. If the price of oil remains low for an extended period of time they may have difficulty paying off their debt. The bankruptcy of any major company would surely cause a selloff in the rest.

    I owned VNR but sold it because of concerns about its ability to sustain its dividend. With lower oil prices comes lower DCF and the increased possibility of cuts in dividends.

    I am focusing on the negative because a defensive mindset at this time may save me money, which I can use in the future to buy stocks when more of the future has been revealed.
    Oct 15, 2014. 08:44 AM | Likes Like |Link to Comment
  • Bonds Persist In Their Warning About The U.S. Economy [View article]
    I agree with your thesis. My bonds continued to go up in value. I could sell almost all of them at a profit. Unfortunately, it will cost me more to buy new bonds when my existing ones mature.
    Aug 16, 2014. 11:59 AM | 2 Likes Like |Link to Comment
  • Why Short-Term Bonds Can Be A Long-Term Disappointment [View article]
    I think you have made some very good points, particularly for individuals who buy their own bonds. The constant refrain of, "ladder, ladder, etc.," sometimes fails to take into account the short and intermediate trends in interest rates. The "imminent" rise of the ten-year treasury note to 4% or greater keeps getting pushed into the future. Surely this will occur, but until then it doesn't make sense to buy three-year bonds with yields that are significantly lower than seven-year intermediate ones.

    Aug 9, 2014. 02:02 PM | Likes Like |Link to Comment
  • Why I Love - And Profit - From Secondaries [View article]
    I think that Bret describes a viable way to make 3 to 5% gains in the short term. Over the course of the year, even if one had only $10,000 to allocate to this activity, it would result in meaningful gains. The downside for most investors, myself included, is the vigilance required to buy when the stock drops and sell when the stock goes back to its pre-selloff price. When this happens for an MLP or REIT that I own, I am in a good position to exercise the strategy. For stocks that I don't own, it is much harder. I am retired. The older I get, the less inclined I am to spend a significant portion of each day exercising search strategies. Still, it's a good idea.
    Jul 17, 2014. 11:15 AM | 2 Likes Like |Link to Comment
  • How To Boost Return On Preferred Stocks To 20%+ [View article]
    The PNC Financial Services Group has a preferred stock PNC-Q with a yield of 5.375%. The stock is currently selling for $23.37, which is a 6.52 percent discount of its face value. Even with this discount, the yield is only 5.75%. If interest rates go up, the value of this preferred stock will decrease even further. (My assumption). It seems possible, or even probable, that anyone who paid $25 for this preferred stock will never be able to sell it at that price. It's also possible that people who bought this preferred stock for $23.37 will have a hard time selling it at that price in the near future. Comments?
    Jul 15, 2014. 07:00 PM | 1 Like Like |Link to Comment
  • The Fed And Preferred Stocks: Perceptions Vs. Reality [View article]
    It's the 5.9% coupon. People are buying yield, not necessarily quality yield. An investment grade preferred stock with a 5.75% coupon is not going to do as well as an non-rated preferred stock with an 8.0% coupon. The following chart on The Yield Hunter presents a pretty consistently clear picture.
    Jun 13, 2014. 03:23 PM | Likes Like |Link to Comment
  • The Fed And Preferred Stocks: Perceptions Vs. Reality [View article]
    I agree that it is a good idea to purchase preferred stocks below their the call price. However, many preferred stocks with coupons below 6.0% may never be called. If interest rates finally do go up, the face value of these preferreds will drop. Anyone who buys even an A rated preferred stock with low coupon rates may never be able to sell them at face value. The Yield Hunter has excellent data regarding preferred stocks. (

    Jun 13, 2014. 12:30 PM | 2 Likes Like |Link to Comment
  • Barron's Is Wrong On Kinder Morgan Energy Partners [View article]
    I was under the impression that the media was supposed to report the news, not make it. I unfortunately owned LINE when it was savagely attacked, and even investigated. I sold out, taking my loss, while the financial hyenas made money selling short. I did hedge my position with some puts, which softened the blow. Is common sense ever used in these kinds of analyses? There are numerous pipeline building sites with KMP prominently displayed. In business, you have to spend money to make money. I am long KMP.
    Feb 24, 2014. 07:15 PM | 3 Likes Like |Link to Comment
  • What Happens To Dividend Growth Investing When Inflation Hits 10% [View article]
    An interesting article, but I question its utility under the present, and intermediate-term, circumstances. When was the last time inflation even approached 10%? I could cite a long list of articles warning about impending inflation. So far, they've all been wrong. Fed policies have focused on deflation. There aren't many areas where housing prices have rebounded to anything resembling pre-crash levels. The buying power of most middle-class families is lower now than it was 10 years ago. Since the great housing crash, salary increases for people who work in state and local governments, as well as teachers, have been the exception rather than the rule. It's hard to see 10% inflation under the circumstances.
    Feb 5, 2014. 11:49 AM | 1 Like Like |Link to Comment
  • Penn West: When Will The Pain Stop? [View article]
    You make some excellent points. This stock is quite capable of going down to five dollars. Let's do the math. If someone purchased 2000 shares of the stock at $10 they made a $20,000 investment. When the stock goes down to seven dollars, their investment is now worth $14,000, a 30% decline. The intrepid investor holds on, waiting for better times. Unfortunately, the stock goes down to five dollars, and the initial investment is now worth $10,000, or a 50% decline. How many years at a 7% dividend will it take to for the value of the investment climb back to $20,000? A rhetorical question. Wouldn't it make more sense to invest the remaining $10,000 in a stock that was actually increasing in price, and increasing the dividend. For example, I own VNR, which keeps making a 52-week high and pays an 8% dividend. I'm not patting myself on the back for a great investment, rather I'm pointing out that there might be quicker ways to getting back to $20,000 than hoping and holding onto PWE.
    Jan 24, 2014. 10:05 AM | 4 Likes Like |Link to Comment