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Suburban Propane Partners, L.P. Message Board

  • run35ok run35ok Jul 11, 2012 8:21 AM Flag

    trading top at 44?

    Mini, miney, mo.

    This market sucks!

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    • :--)) - LOL - You make me Laugh b/c I'm probably the same age as your sis and older than you. I'm beggining to see more and more disgust for the trading environments credibility. The mid late 90;s were very magical, yes you could throw darts, and in fact they did to prove it. They had monkeys, cheerleaders throwing darts and it just proved that in true bull markets 75 % of all stocks go up. We had 10-15% gains each year and expected that forever. When I told my dentist I bought PFE for 14 and change and started talking a mile minute about the yeild, he had this wierd look and told me he paid 60 for the stock and still had it. Once You've lived thru a few recessions you get the hang of it. I'm pretty sure this is the firt time in history were the yeild on the S&P is higher than the 10yr note so we have a market looking for yeild and so the stocks are priced like bonds, and we stay rangebound. It will stay that way till change occurs. They won't let housing find its own bottom, they keep buying notes, creating this artifical environment that our financial structure isn't used to. Sort of like changing the laws of thermodynamics. So. I go for yeild and treat each stock as I would a bond. Hence, SPH, my first MLP. Tech stocks for the most won't do much until unemployment picks up. One last thing. Scandal has always plagued wall steet since its inception. Good Luck!

    • NRGY has a negative EPS, and they've already cut the distribution. HPQ has been a value stock for years, they just can't get it together. My friend just left after 10 years to work at CITI. Those guys have no confidence in HPQ so they just sell and take the 15% employeee discount. I've had good luck w/ PFE, BMY, and GE. I watch GMCR because its been so beaten up & MSFT b/c its overdue but this artificial environment that they set up with 10yr notes trading at 1.5% defies the laws of thermodynamics so you get funny results like rangebound markets and yield chasers like us holding it up.

    • I didn't say I was about the buy it. I said these are the reasons for buying it.

      The biggest hangup about INERGY is that their mgmt. has shown poor judgement over the years, like loading themselves up with debt and not being able to sustain the dividend.

      If I were to buy it I would give it 6 mos to a year and see how they perform. At this point the upside looks better, mainly because they will have no debt.

      I like HPQ as a turnaround and am watching it. My goal is to enter at 17-18.

    • The round no. that has been talked about is 1/10. That ratio is based on 13M SPH/130m NRGY. The NRGY float may be smaller than 130M, so the .11 ratio could be right.

      According to analysts the fair price for NRGY is about $15 (as of articles 1 month old). The way I see it is that the $19.50 present price already has the SPH .11 distribution of $4.73 premium already baked in. That answers one of my questions

      If you were to buy NRGY now you would be hoping that their new no-debt Position will allow them to grow in the NG storage business better than if they had stayed in the propane retail. Only time will tell the story.

      My reason for wanting to buy NRGY is a) to get extra SPH units at a discount b) to add to the SPH position I already have c) to speculate on NRGY growing in the NG business and d) to be in SPH with more units when the larger propane business yields more income (and larger distributions to unit holders).

    • The NRGY BB is much more active than SPH's. Don't look like you get a free share of SPH for every 10 shares of NRGY.

      NRGY unitholders will get .11 share of SPH trading at $43 or about $4.73. NRGY will get another $200mm or $1.60 for each unit, but that won't be distributed.

    • Here is my problem with NRGY:

      A well managed fund (see article thread on NRGY: I believe their name is Wellington Fund) liquidated their NRGY position not too long ago, and they were aware of the SPH buy. Why?

      From the little that I have read NRGY mgmt is not very good. That makes me wonder whether their strategy of focusing on NG storage is sound.

      The last concern is whether NRGY would actually distribute the SPH units or keep them. Some of these Boards do strange things to shareholders, and let's face it, I would be surprised if their interests are the same as ours.

      If I buy 1000 units of NRGY I may find myself holding a dead fish.

      If you look at their position after the SPH sale they will be almost debt free and hold to NG storage facilities worth about $700M, plus other assets and we are looking at about $1B. Divide that by 130M units and their book value is roughly $7.50. Is a premiun of 19.5-7.5 (or $13) worth paying? It would be if we discount the price by the SPH unit AND the potential of good profit margins in NG pipelines and storage.

    • 15.50 you'd do even better ;)

    • I see what you mean. It sounds too easy. The deal is 1 share for each 10 NRGY so essentially buying 1k shares NRGY at 19.50 19500 would give you 100*45=4500.00 SPH $$. Roughly 25 %. Hmmmmmm.

    • is anybody awake on this Board?

      It looks like the NRGY purchase is going through. SPH stock is moving.

      The way I understand it is that SPH will issue stock to the tune of $600M and turn it over to NRGY for distribution to their unit holders, the distribution to take place some time after September.

      If I'm right NRGY holders will get 1 SPH unit for every 10 NRGY units they hold (roughly). That being the case it seems logical to pick up NRGY shares now and add SPH shares to what we already have.

      I'm I right or not? Help

    • I'll take it all back.

      Ican eat my shoe!

 
SPH
44.47-0.28(-0.63%)Aug 29 4:05 PMEDT

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