MLPS OPEN HIGHER AGAIN
BUT WHO KNOWS FOR LATER.
TARGA OFFERS TO BUY MARKWEST.
Short open post this morning. Someone posted the question about whether the MLP index is adjusted for distributions. Looks like it was this morning as the index is trading under yesterday's close but is listed as higher by my quote service. Maybe they do it on payout day all at once. I'll find out. Meanwhile an odd piece of news this morning as Targa Resources (NGLS) is offering to buy Markwest Energy (MWE) and Markwest Hydrocarbon (MWP) although no price was given and they said the company has not responded to them. Headlines on this one as they break.
I'll post again later this morning.
joseph cioffi's Source Page - Associated Content
4 comments:
Josh Peters, of the "Dividend Investment Newsletter", has put out a buy on MGG.
MGG cont.
While these factors make MMP an attractive potential investment in its own
right, Magellan Midstream Holdings (MGG) is even more compelling at current
prices. Like Buckeye GP Holdings, MGG's sole asset is a general partner interest
in MMP that benefits disproportionately from the growth of MMP's cash
distributions--somewhere between double and triple the rate of growth. The
current yield on MGG is a lower than that of MMP (4.7% versus 6.0%), but at a
conservative 5% annual growth rate for MMP's distributions, I estimate MGG will
be able to raise its payout at an 11% annual rate. Even though MGG's current
yield is a bit below the Harvest's minimum threshold of 5%, MGG's distributions
are growing so rapidly that I expect we'll collect more than 5% of this
investment in income in the first year. And based on the yield we obtained at
today's purchase price, I expect our long-term total returns to approach 16%
annually.
"The Alerian MLP Index is a composite of the 50 most prominent energy master limited partnerships calculated by Standard & Poor's using a float-adjusted market capitalization methodology. The index is disseminated by the New York Stock Exchange real-time on a price return basis (NYSE: AMZ). The corresponding total return index is calculated and disseminated daily through ticker AMZX. To learn more about the index, please view our Frequently Asked Questions."
http://www.alerian.com/insight.html
JF50
10. How will distributions be treated?
The price-only index does not take distribution payments into account. The total-return index reflects distributions by including them on their respective ex-dividend days. Distributions are then reinvested in the index on a daily basis.
http://www.alerian.com/AMZ-FAQv3.pdf
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AMZ is the price only index, the total return index is AMZX, I can't find quotes for the AMZX index, perhaps it's on the Bloomberg terminal.
JF50
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