Wishful thinking but i do think it makes a lot of sense for Kinder to try to buy NGLS/TRGP right now given the collapse in share price. I mean 55-60 offer would be hard to turn down right now and that is a lot of bang for the buck for kinder.
I owned Copano and it was doing almost as good as Targa, up over 150% for me. When Kinder bought up Copano I lucked out and sold. If I would have held it I would have been about 25% in the red now.
Great opportunity to collect 7% plus dividend from a solid company that is also a take-out candidate. I bought more at $42.70 today. I can wait this out - especially with a high and secure dividend.
"#$%$?"?? Exactly my sentiments! If anyone has a clue what is going on here, please enlighten us.
I know NGL prices have been very weak, but the company still plans to raise the distribution by .40/unit next year.... Something's just not right about this price plunge!
Unlike KMI (35%) or EPD (36%) Targa management owns virtually none of NGLS shares, and are not buying at these depressed prices. Their interests are not aligned with shareholders. You saw this on the rejection of the buyout at near $80-that would have put them out of a job.
I bought much cheaper. I owned KMP and so already have a high re-capture this year. This stock will continue to clip the coupon and is tax efficient but we are in a new low interest rate era and old MLP growth modal is dead. Don't expect to see 70 bucks again. KMI is the new way to modal.
Thanks to all my message board co investors who gave me a thumbs down on this prediction-it reinforced to me that this stock was severely overbought. Basis economics - commodity goes down revenue goes down stock goes down. If Natural Gas under $3 now what do you think it will be in Spring?
Thanks for the amusing post but you left out one other possibility-basic economics where price of commodity goes down, revenue goes down, price goes down. Unfortunately common sense trumps all hedges, fixed fess etc. What happens if one of their producers goes bankrupt? Happy investing!
They can have my shares for 50 bucks. KMI is new low cost of capital modal. Days of growth with 9% drop downs are over.
As producers shift focus to sweet spots in Permian Basin, Eagle Ford, (etc) they should need more gas processing capacity, not less. RBN example of NGLS and APL
Look for gathers, processors, transporters, etc who have a preponderance of acreage commitments to the sweet spot producers rather than the fringe producers for the near term would be my observation.
Maybe they turned down another buyout offer. NGLS/TRGP getting smoked a lot more than others last few days…down 20% in a week after already being down 30%. If KMI is at all interested they need to sell out.
I agree. They might get a buyout from Kidder. Also it seems that none of the officers has sold their shares when shares are granted to them. So maybe they are holding out for recovery or a buyout.