For MLP's PE is not real good indicator ... look at (1) DCF (Distributor Cash Flow) (2) Coverage Ratio (does DCF cover Dividend, less than 1 is not good) , w/Coverage Ratio note the quality of the DCF , from borrowing is not good
GAAP earnings include required mark to market adjustments of hedging derivatives, which even though are generally costless positions, nevertheless produce huge swings in values when oil or gas prices move. That, and other GAAP adjustments, make "earnings" pretty much useless for MLP's.
Distributable cash flow (which is what G was trying to say), is a straight forward operating cash flow measure that includes a charge for capex to maintain production (or rather, cash flow, not the same thing) that would otherwise be capitalized for GAAP, and is the most useful measure of an MLP's performance. "Coverage" is simple the ratio of DCF to distributions, over 1.00 means there is excess cash flow being generated, a good thing.
But that's way too simplistic, because BBEP had a 1.3 coverage ratio this quarter, and you had to know two things in order to evaluate that number. First, everyone knew an offering was coming that would reduce coverage, and second, we also know that is an intermediate number that does not reach the full benefit of the recent acquisition. You have to read (and evaluate) management's guidance as well.
The other important metrics for an upstream are reserve life (I want 15 -20 years), and debt to adjusted EBITDA (I agree with management's target of 3.0X). Some MLP's are more conservative on debt, which is fine, but 3.0X seems to be a limit most are comfortable with. Then's there structural issues, are there complex arrangements with the sponsor that the market doesn't much like (QRE), or has management lost credibility with the markets (EROC). You can't just look at coverage and plunk your money down.