Big cap MLPS are taking the index lower again as the overall market rallies. Energy Transfer Partners (ETP) is down 1 and change. Is it because its anticipating a stock offering because of the new aquisition? No news on it. Energy Transfer Equity is flat to up a few pennies.
Some breaking news this morning on Crosstex Energy LP (XTEX) as they say they are restating earings for the first 2 quarters. The stock has been down, then up, and now its down 75 cents. The company says no restatement required for Crosstex Energy (XTXI). Meanwhile Plains All American Pipeline (PAA) says its earnings will meet the high end of expectations. The stock was up 50 cents initially but now its flat on the day. Oneok LP (OKS).is down another 60 cents with no additional news there. Copano Energy (CPNO) is down 1.35. No news there. I put the chart up on Copano yesterday as a breakout possibility but i was leary on this one because of the lack of volume.
The XOI is desperately trying to hold the 1040 area as it is now down 5 points after being up a couple earlier. Volitility is the name of the game these days. Crude Oil is holding 60 bucks at least so far today.
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- joewxman
- a meteorologist with a knack for trading and investing in MLPS! I also like horse racing, enjoy cigars and a good port wine.
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6 comments:
Yes, I think ETP is getting smoked because of the impending offering to fund the acquistion. It is really a falling knife on the chart. It is a bad day with my MLP portfolio down 1.15% so far. ETP looks like the cheapest play with loads of organic growth off a 5.80 yield. I thnk i may put in a bid below 44 to get some.
you should have gotten it! Meanwhile i've been successfully playing ete which i am trying to buy back at 27.25
i did get some. etp said they will fund more than 50% of the 1.465 bln aquisition with new stock, so that could be a 15-20% share issuance. it will be accretive but it looks to me like mlp's get destroyed whenever they issue stock. any advice for a newbie? it seems the general partner is the big winner and they get their distribution growth over more shares.
Usually when new shares are issued the stock is dead money for several weeks while the shares are absorbed. I decided to go with the GP because i think ETE is undervalued. Ultimately at least its been true that the offerings wind up being buying opportunities. As long as the company is growing distributions faster than the industry average you will be okay,
I think Keith is right on...issuance of new shares at the MLP is immediately accretive to the GP. Pretty much free money...and ETE is trading down today? Go figure...
mike
75 centavos from ETP !!!!!!!
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