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Smarty_Pants

Smarty_Pants
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  • Liquidation Of Crowded Hedge Fund Energy Positions [View article]
    Good thought process. Find the gems that got tossed out with the garbage in the natural resources space.

    I picked up shares in USAC and KNOP at yield points over 10% recently. They are both solid and well run service companies in the oil/gas industry that continue to grow and reward shareholders despite the recent carnage among producers and the companies who supply them.

    Gas producers and pipelines will continue to lease and add compressors to their current and new assets from USAC.

    KNOP will continue to lease out their tankers in oil producing locations without access to pipelines or rail transport.

    It's only a matter of time before 'the crowd' realizes that these companies are grossly undervalued. Until then, I'll collect my 10+% payouts waiting for their prices to recover.
    Aug 27, 2015. 04:59 PM | Likes Like |Link to Comment
  • This Dividend Stock Yields Over 11%, Has 9 Straight Hikes And Just Raised Guidance [View article]
    Thanks for writing up an article on this growing stock. It looks like another gem amid the wreckage caused by the steep decline in energy prices.

    At first I thought you might be writing about ARLP, which is a similar story. I'll investigate and probably add some share of each before Mr. Market regains his senses.
    Aug 16, 2015. 01:35 PM | Likes Like |Link to Comment
  • Alliance Resource Partners: 11% Yield And 29 Consecutive Quarterly Distribution Increases [View article]
    I agree with the author, ARLP is priced in the "back up the truck" zone. I've picked up shares at simply crazy prices recently. A rebound will eventually happen, it's just a matter of time. Meanwhile I'm collecting 10.5% (and growing) dividends on my investment.
    Aug 14, 2015. 10:43 PM | 4 Likes Like |Link to Comment
  • The MnM Portfolio Supplement - It's Hard To Go Shopping When Nothing Is On Sale [View article]

    Most of the retiring coal plants are small and old. Even the government's own Annual Energy Outlook 2015 estimates that coal use will grow from 18 quadrillion Btu (925 million short tons) in 2013 to 19.0 quadrillion Btu (988 million short tons) in 2040.

    http://1.usa.gov/xFtUjL

    Coal is the lower cost means of generating power most of the time. NatGas generation is less expensive at prices below $4/mcf (which has occurred about 12% of the time since 2000).

    http://1.usa.gov/1Wm0f5x

    The EIA further estimates that “Coal-fired capacity declines from 304 GW in 2013 to 260 GW in 2040 in the Reference case, as a result of retirements and very few new additions."

    Clean Air regulations will surely weed out older plants, but it won't close them all. A drop of 40 GW from 304 GW over 27 years is less than 0.5% annually. Meanwhile ARLP will be selling the remaining coal fired plants coal, making profits, and rewarding shareholders.

    Again, the current price of ARLP is worth a look based simply on business performance going forward. Coal fired generation plants are going to be around for a long time to come.
    Aug 13, 2015. 11:14 AM | 1 Like Like |Link to Comment
  • The MnM Portfolio Supplement - It's Hard To Go Shopping When Nothing Is On Sale [View article]
    You might find ARLP interesting. It's crazy undervalued and worth investigating.

    http://seekingalpha.co...
    Aug 13, 2015. 05:17 AM | Likes Like |Link to Comment
  • The Coal Industry Is Ready To Implode [View article]
    Articles like this one will be the ones identified as the contrarian evidence of a turning point in the coal mining industry, IMHO.

    Markets weed out inefficient or financially unsustainable producers over time. Today's currently overleveraged coal producers will suffer while the better-run companies use the opportunity to acquire more properties at discount prices, eventually making them viable producers.

    Disclosure: Long ARLP and AHGP, and likely to buy more at these bargain prices.
    Aug 10, 2015. 11:58 AM | 1 Like Like |Link to Comment
  • Gold Resource Corp.: Commentary On The Second Quarter Results [View article]
    Thanks for the update and taking the time to put all that information into a concise format so that it can be easily compared.

    It does appear that GORO had a rough 2Q, but despite the 'triple whammy' they managed to eke out a small profit. Any complex business needs to endure such rough patches if it plans to succeed. They seem to be doing the right things to overcome the hurdles that they encounter.

    Despite all the negatives, GORO has paid their dividends and only used $3+ million over the past year. They have enough cash to weather another 6 years under those conditions, and one might reasonably expect the 'whammies' to be resolved in much less time than that. The illegal strike is already over and the company is working to remedy the water issues in the current site and develop another mine site, which would reduce the importance of having their one mine site stop producing. Sadly, there's nothing the company can do to improve the prices of gold and silver, or the other metals they produce.

    I'm long GORO and dripping the dividend into more shares. I believe that the company will continue to improve as they work through the current issues.
    Aug 7, 2015. 09:31 AM | 3 Likes Like |Link to Comment
  • Avoiding The Endowment Effect: Should Mike Sell? [View article]
    "First off, I hope I'm not being presumptuous in assuming that I am the "noted DGI investor."" - Mike Nadel

    Perhaps the original post was missing a white space and intended to say 'not Ed' (which is easily verified by reviewing your profile - your name is NOT Ed).

    Once upon a time we had a 'notbob' around these parts, but he went legit and changed his name to Robert.

    :-)
    Aug 2, 2015. 03:14 PM | Likes Like |Link to Comment
  • Alliance Resource Partners acquires rest of White Oak Resources [View news story]
    "David M, Don't overlook the value of technological innovations. The Nazis converted coal into gasoline. The energy trapped in coal is immense. The USA has the worlds largest coal reserves and who knows what can be done with this asset." - aretailguy

    South Africa has been producing synthetic diesel fuel from coal since the 1950s, out of necessity more than anything. (next link is to a powerpoint presentation)

    http://bit.ly/1Sw0885

    See slide 5 in the presentation

    It's called the Fischer–Tropsch process:

    http://bit.ly/16a4WFN

    If the cost of producing petroleum products via oil extraction increases sufficiently it will become economic to generate them from coal or nat-gas instead. It's one of the positive aspects of "Peak Oil". There's plenty of coal that can be used to produce the same gasoline, diesel fuel, etc. (at slightly higher prices), so we won't be going without them entirely.

    Disclosure: Long ARLP and AHGP.
    Aug 2, 2015. 08:51 AM | Likes Like |Link to Comment
  • Avoiding The Endowment Effect: Should Mike Sell? [View article]
    "Larry Swedroe refers to this principle as the "endowment effect." In his opinion, "If you would not buy more at a given price, you should be willing to sell at that price." - Ted Fischer

    Sorry, Larry's opinion is, as stated, lacking any context.

    If I bought a full position in KO at a 3.10% yield point and it currently trades at a 3.2% yield point, it is still worth buying in a general sense. I may not choose to buy more simply because I have a full position already, although that in no way invalidates the worthiness of buying KO at the slightly lower price for someone without any position.

    Perhaps Larry goes into more detail in his book and Ted's summation is a simplification of that expanded line of reasoning. Then again, perhaps not and Larry's opinion is not very thoroughly thought out.

    As an unverified, blanket statement however, I disagree with Larry's claim.

    As for KMI. They just completed a massive consolidation of the Kinder Morgan family. It will take time to iron out the financial pile of details. I'm a bit overweight KMI myself, but I'm waiting to see how they address and consolidate everything before even considering selling shares. The dividend is growing great, as promised, and that's why I bought it in the first place.
    Jul 30, 2015. 05:05 PM | 12 Likes Like |Link to Comment
  • How Much Kinder Morgan Is Too Much For A Dividend Growth Investor? [View article]
    ">>capital intensive coal industry.<<
    Therein lies the Problem." - Isuavecito

    Read the numbers before you jump to a conclusion on a particular company. The INDUSTRY is capital intensive, but the company has a Debt/Equity ratio of 0.61, and a distributable cash flow of 1.7 x the dividend payment. They've done a pretty good job of managing the financials in a conservative fashion.

    Mr. Market must have like the results of Q2 operations as the price is now more than 4.25% above my buy price from yesterday and my yield is still over 11% with the new, higher dividend.

    Read through the Q2 conference call transcript for yourself:

    http://seekingalpha.co...

    You might like what you see.
    Jul 28, 2015. 04:13 PM | 2 Likes Like |Link to Comment
  • How Much Kinder Morgan Is Too Much For A Dividend Growth Investor? [View article]
    "The company reports Q2 2015 this morning." - me

    Q2 earnings were off by $0.13 on a 1% increase in revenue. Still, they raised the next dividend by 1.9% and now have a forward yield over 11.6%. It's a steal at under $25 per share.

    http://seekingalpha.co...

    http://seekingalpha.co...
    Jul 28, 2015. 08:33 AM | 3 Likes Like |Link to Comment
  • How Much Kinder Morgan Is Too Much For A Dividend Growth Investor? [View article]
    Mike,

    If you decide to trim and invest elsewhere you might consider looking into ARLP.

    The price of this company has been beaten down to the point of absurdity: P/E < 6, Payout Ratio < 60%, Yield > 11% and they have had over 20 consecutive quarters of increasing their dividend. Their debt is also very reasonable for the capital intensive coal industry.

    Analysts covering ARLP give it 2 strong buys, 3 buys, and 2 holds.

    http://bit.ly/1DLrMSy

    If you split your KMI sale money and were to put some into ARLP the "excess" yield there would allow you to put the remaining money into lower yielding DG stocks while still matching the KMI income you lost. (1/3 at 11% and 2/3 at 3% gives 5.6%-ish total income)

    The company reports Q2 2015 this morning. Maybe you'll like it enough to dip a toe...
    Jul 28, 2015. 07:55 AM | 2 Likes Like |Link to Comment
  • Why I'm Calling The Federal Reserve's Bluff [View article]
    Meanwhile:

    1) Puerto Rican Bond fund facing lawsuits and arbitration demands over losses exceeding $600 Million:

    http://bit.ly/1SHpE51


    2) Congress is considering a bill to allow Puerto Rico to file for bankruptcy and "adjust" their debts:

    http://1.usa.gov/1SHpE52


    Yep. Our government bonds are safe. Trust us.
    Jul 25, 2015. 09:13 AM | Likes Like |Link to Comment
  • The End Is Near For Puerto Rico Bond Investors [View article]
    Nice piece of self promotion.
    Jul 25, 2015. 09:03 AM | Likes Like |Link to Comment
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