TRACING OUT
THAT BOTTOM
THAT BOTTOM
The bottom is a bumpy place and never a straight line. Its a frustrating place where bulls and bears get frustrated on an almost daily basis. And thats where i think we are right now. We also continue to enjoy relative outperformance which emerged in November; perhaps co=incidently or not with the peaks in the credit squeeze. So if yields in corporates continue to improve, it could be the more important factor driving mlps foward as i have argued in the last few weeks. The path of least resistence here is up unless the stock market completely falls apart.
Duncan Partners (DEP) has boosted its distribution last Friday which is no surprise as Dan Duncan continues to buy shares here and in Enterprise Products Partners (EPD). And we are inching closer to finding out what other MLPS out there are going to do with their payouts. Stock futures are flat to a little lower this morning. Crude and other energy showing minus signs. Crude down 2 bucks this morning. Nothing so far on the upgrade downgrade list.
joseph cioffi's Source Page - Associated Content
2 comments:
GEL also boosted its divy last friday. 16% yoy.
http://biz.yahoo.com/bw/090108/20090108005389.html?.v=1
As I mentioned, its my favorite stock, fwiw
From Zack's today:
"We are downgrading MarkWest Energy, a predominantly natural gas gathering and processing MLP, from Hold to Sell. We believe that it will be difficult for MarkWest to sustain current distribution levels in the face of weak commodity prices and reduced access to credit.
An unfavorable macro backdrop, characterized by reduced access to credit and equity markets and weak commodity-prices is expected to weigh on the partnership's distributable cash flows, forcing it to cut distributions to conserve capital.
We are projecting that MarkWest Energy will slash its distributions by 50% to the annualized rate of $1.27 per unit. Our new price target is $7.00 per share."
If this happens, I hope that MWE cuts the distribution enough so that 1) they won't need a second cut down the road, and 2) so that they have enough cash flow to fully fund capex and to excercise the MEP option.
As a long-term owner of MWE units, I want them to take a long-term view.
Bruce
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