9:02 AM Inergy (NRGY) is upgraded to Neutral from Underperform at Robert W. Baird, with its price target raised to $21 from $15, based on the company's propane unit sale. In addition to exiting the poor retail propane business to focus on the more attractive midstream business, the transaction delevers NRGY from 55% debt/capital to 25%
I don't see anything positive happening to the NRGY price until the sale which still is not a done deal. I was hoping to play a propane rebound but that would now be limited with NRGY. Therefore I am out after a decent short term, but less than expected long term gain.
Don't get me wrong, I very much like the new direction that they are taking and feel that they should be able to increase their distribution next year. However, the risks outweigh the potential gains until 4Q.