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  • CVR Refining: A 20% Yield Backed By Increasing Margins [View article]
    One strategy of buying and selling around refining MLPs I use (NTI, CVRR, CLMT) and HFC is looking in specific instances in the short term where regularly scheduled down time for plant cleaning, expansions, upgrades are occurring. For companies that have limited assets like CVRR with 2 refineries and NTI it could weigh on earnings and the distribution for the quarters that it occurred. Same thing goes for any unexpected shutdown for any reason. These instances dramatically affect share price during this time no matter if it was well publicized or not. One reason why I think HFC is stagnant right now is it is currently turning around two of its plants, and likely the next quarterly report will reflect that. NTI the same. CVRR right now is in the clear for the rest of the year and should be bought now me thinks. Of course each company may hedge and stockpile going into planned shutdown and turnarounds, but unexpected events occur. For MLPs that rely on few assets like just 2 refineries like CVRR, a fire shutting one of the refineries down unexpectedly for a month could weigh on that quarters profit and cash flow for distributions, and drastically effect share price as well. HFC has the most refineries out of the three with a smaller quarterly dividend, but each (CVRR, NTI, HFC) presents their own specific levels of risk. This is only one of the factors I look at when gauging these high yield MLPs that are doing well right now.


    Long CVRR, NTI
    Jun 5, 2013. 12:02 AM | 1 Like Like |Link to Comment
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