Subscribe to:
Post Comments (Atom)
adbrite ads
mystic monk coffee
investment strategy tips
joseph cioffi's Source Page - Associated Content
http://www.associatedcontent.comuser/505733/joseph_cioffi.html
joseph cioffi's Source Page - Associated Contenthttp://www.associatedcontent.comuser/505733/joseph_cioffi.html
About Me
- joewxman
- a meteorologist with a knack for trading and investing in MLPS! I also like horse racing, enjoy cigars and a good port wine.
FEEDS AND OTHER BLOGS
seal of approval
OTHER INFORMATION
OTHER INFORMATION
5 comments:
If MLP's are so cheap, why aren't MLP's acquiring other MLP's???
They won't do that until the yields get over 10. Then it becomes accretive to do so. That's why Atlas stopped dropping when it was yielding exactly 10. If it gets higher, one of the major MLPs would buy it.
Of course no one will touch CLMT (sitting at 12%) until they are sure the convenants aren't going to be broken.
I'm not sure where you got your "rule of 10".
PAA bought PPX when it was yielding around 8% a couple of years ago. You need synergies for acquistions to work in addition to assets being cheap, and there are a lot of cheap assets out there now.
There may be cheap assests but the cost of capital has gone up so when PAA bought PPX they had access to much cheaper money.
Obviously 10 isn't a magic number, my point was that is probably a minimum before deals would happen.
Point taken, although the KMP's and EPD's of this space still have pretty good access to reasonably cheap capital.
Post a Comment