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Crestwood Midstream Partners LP Message Board

  • afghanistan_bananastan afghanistan_bananastan Oct 24, 2013 8:17 PM Flag

    Thanks for nothing

    I see the new management has "boosted" the payout by half a cent per quarter. At that rate of increase, by my calculation, adjusting for the extra shares, it will only take four years for pre-merger CMLP holders to see equal the payout we were once enjoying.

    Sentiment: Hold

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    • Increase in divi the last 6 quarters. A total of 9%. How about dealing with fact based opinion. 6 qtrs. ago divi was .37. Now40.5. Do the math. Now is the time to add to your position. Long term Strong Buy..

      • 1 Reply to rebeldoe
      • It's OK distribution growth but nothing to write home about. Other midstream MLPs have done more.
        Part of the problem is the extortionate IDR structure where NRGY (CEQP) gets 50% of all distributions above the original minimum quarterly distribution. No tiers here, skip right to the 50% splits for anything above the minimum quarterly distribution. That's unique among MLPs so far as I know.

    • If you really believe it will take four years for shareholders to realize benefits of the merger and capex program.... why would you hold? I would dump in a minute. Here is why we should all want to hold.
      CMLP just concluded major acquisition, major debt raise that private holders asked for more and a major share issuance. These are all preludes to higher growth and higher distribution growth. If you do not understand conceptually what CMLP management is trying to accomplish you should not own this MLP.
      A little over a year ago, XTEX made a similar acquisition that was transformational. XTEX's assets prior to the merger were in energy areas that were slow to no grow. XTEX made the acquisition, started a $1B organic capex program, issued shares and debt and for the next year did NOT increase their distribution instead retaining the distribution so that less debt would be used for the huge organic growth program. XTEX ran into some capex timing/completion issues.
      XTEX just raised by $0.01/qtr.
      Then, earlier this week, XTEX announced transformational relationship with Devon. XTEX shares have doubled since DEC 2012.
      The fact that CMLP could raise even that small amount is a very positive sign. Remember that has to be shared with 14M new shares immediately and we will have to wait for the bigger reward of higher distributions and higher share prices until the acquisition and capex produce higher dcf.
      My gut check on all this is that a former EPD division head understands what it takes to get in the pit with the big dogs of the MLP industry. He is working toward obtaining investment grade status for CMLP. The XTEX transaction may give him impetus to find a similar transaction with an upstream MLP next year. When EPD bought out Teppco there were loud howls against it because Teppco was seen as inferior assets. EPD soon proved they had a lot of integration and organic growth to bring to Teppco's asset base. I think same can be done with NRGM and NRGY.

    • You got $1.03 also. You got the Arrow deal to grow this also.

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