marv, love the posts and agree that MMP, ETE and EPD are great. But I am seriously thinking of punching out. All of their charts have turned and if this bear market really gets going, they all will be available much cheaper. You make good points about m&a possibilities, but you can't always expect a great premium in a buyout. In this market, the buyers (KMI and ETE) don't have to overpay. We saw MWE sold for a much lower premium (if you can consider it a premium considering many including me thought that $90 was achievable). Plus deals will mostly be for stock and the acquiror's stock will likely get hit after a deal is announced.
Some will say that it is too late to sell, but that can only be measured AFTER we see where these bottom.
Anyone trading the MLPs would be well advised to use limit orders only. Crazy volatility has become the norm, and sellers in particular are getting creamed. Protect yourself with limit orders if you don't want to get robbed.
Just an addendum. CS had these remarks. Drop to TP of about 88-89. 15% for rest of 2015 and at least 10% in 2016. Not adverse to buyout. The Sunoco I speak about is SXL who can take the oil pipelines and Sun the retail Sunoco stations when ETP drops the rest of their retail stations. The ETE family works. By the way I had my lobotomy and live in Palm Beach Cty.
For all those who took my advice -sell in May and go away I applaud you. I personally am in the camp do as I say not as I do. MMP is my 3rd largest holding and my second most secure after ETE. One would think that because MMP is in the gasoline and diesel pipeline business ,storage of oil and other refine product business that they would have escaped the meltdown But they went into an expansion of oil pipelines last few years and the weak minded public and analysts associated them with oil. It did not help their 1st quarter results were less than spectacular While second quarter improved and 10% guidance for year end has changed their focus somewhat. So if you have a 5-10 % paper loss in MMP you are ahead of the pack presently. I still see them as the best buyout candidate in Mlp group. It may take 2 years but KMI and ETE will do it. ETE has Sunoco and Sun which are in the gasoline retail business and if they don't affect the refiners they fit in perfectly with MMP. MMP is sitting OK in this meltdown ala 2000 2008 and such, Stay with it
IMO, the entire selloff in the MLPs has been almost entirely unjustified. One day they go down because oil is down. The next day they go up because oil is down. There's a disconnect that defies logic. I've given up trying to make sense of it.
Lots of downgrades on pipes from U.S. Capital including MMP. EPD remains one of their top picks (no downgrade on that name.) There's plenty of negativity to go around. That said, I still have a very low opinion of analysts of all stripes.
Trump will not IMO cut Mexico off...he will exact tolls on trucks car s etc to build the wall....that said, let's recognize that the EagleFord shale extends across the Rio Grande into Mexico..and where better for Mexico to pipe the oil and natural gas liquids than Corpus Christi where MMP is starting to build a bunch of facilities including five ship berths presumably for exports and shipments to domestic refineries in Louisiana etc..this shift to maritime related facilities is going to be a real moneymaker for MMP think I.
I'm not nearly as friendly toward PAA. Don't own it. Won't buy it. The California leak turned me off. I owned ETP for awhile and sold it much higher. I thought of buying ETP, but Cramer turned me off. Cramer's THE KISS OF DEATH! I'll stick with MMP and EPD. If I had to choose just one MLP to own, it would be MMP. MMP and EPD were around the same price until EPD made the foolish decision to split. The split obviously did nothing to boost the unit price and was more trouble than it was worth. Mexico scares me a little. When Trump is President, he's going to build a wall 40-feet high and 30-feet deep. He'll probably cut off the pipelines to prevent Mexicans from slipping through (pun intended).
You speak for me,too. I've been adding to PAA,MMP,and EPD as well...the three are IMO well situated for whatever the future brings...and their assets are well positioned...trying to duplicate the crude distribution network MMP has assembled in Houston would be really tough,for example. I've also been adding in GEL as it seems to be establishing the same sort of position in Louisiana that MMP is building in Houston. Another factor is that with Mexico beginning to open up there should be a lot of opportunity for PAA,EPD, and MMP in the South Texas/Mexico interface. I note that MMP is shifting into maritime action,too. MMP and PAA are JV partners on both BridgeTex and Saddlehorn Pipelines,too, and EPD is big in South Texas NGL action,too.
I read the Cramer article anointing ETP as his MLP pick over EDP. The clown was pumping ETP based on its last QT earnings . Look at a earnings comparison for the last year. I will stay with EPD,MMP and started back with a bit of PAA.
The $4440 that I just collected doesn't even begin to erase the paper loss that's been causing havoc in my finances. I still have a long way to go before I can see daylight. I guess I have to be thankful it held above the magic $60 level, but not by much. I was expecting to see the mid 50's before the blood stopped flowing. EPD is even worse, but I only have half as many units of that one. But we're not out of the woods yet. Cramer just recommended several MLPs, and that really scares me. He's notoriously the kiss of death for anything he touts. I had just sold GOL, the Brasilian airline, at $34 when I heard him touting it aggressively a number of years ago. It's now about $1.35. Nice call, Moron! I only regret not shorting it.
The Tumblr article, 3 Anomalies.... is very revealing in many ways. It took me several reads to get my head around what the author says, but it's very scary stuff. It also probably accounts for the big drop today.
Chuck thanks for your concern. Best check the MMP Option Chain, I don't care whether they are called or not as long as I make a gain. I do regret being busy and not selling a Put when it opened at $61ish, oh well ! Might get it next time.
If you sold calls, at this rate they will likely get called away & you will have left a lot on the table. My condolences to you.