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Targa Resources Partners LP Message Board

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  • wcsg122 wcsg122 Jan 11, 2013 11:58 AM Flag

    this is the worst


    I have been successful with NGLS trading the range and picking up many distributions along the way. However, the tight distribution coverage coupled with the downward trend in NG price spooked me, especially with this low of a price in early January, and I bailed. Yes, Q4 will probably be fine and a distribution increase is just around the corner, but I didn't want to run the risk of getting caught with a company announcement that the increases will soon be suspended.

    As an alternative, I researched CLMT after reading the article 1/6/13 by Akaralph: Protected Principal Retirement Strategy. They have a history of increasing their distributions 3 cents each quarter, and a distribution coverage ratio over 2x. They had a recent secondary announcement, so it pulled back and the current buy in yield is about 7.75%. Their last 10Q (Q3) reported much improved crack spreads, and they have locked in about 50% of their refinning margins for the next 2 years at strong rates. Assuming distributions continue to increase at 3 cents/quarter and the stock moves to the pre-secondary yield of 7.5%, we should see about $39/share by year end in similar market conditons. On the current price of just under $32, this equates to about 20% capital appreciation plus the 7.5% yield along the way for 2013. Anyway, IMO, CLMT looked like a better risk to me, so I took a shot. If looking for another MLP play not connected to NG, you might want to take a look at this one. GL

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    • i own clmt and ngls.
      so my question is why not own both.
      each in 2different areas.
      plus recently ngls has been moving smartly once distribution announced im hoping that ngls rises above 40..

      Sentiment: Buy

      • 2 Replies to dreiser139
      • pt
        i hold mwe and own more of that one.
        another one u may like is gel.
        getting pricey but superb assets and management.
        as always u must do your own dd.
        as for rnf right now its in the sweet spot plus ag stocks on fire.just read mon most recent report.
        and yes ng prices low and this is what is fueling the nitrogen fertilizer market.
        plus rnf right in the middle if americas heartland with cheaper transportation costs then the other nitogen plays.
        plus i believe in comparison to potash nitrogen the cheaper fertilizer alternative.
        in europe and especially india many farmers have switched from potash to nitrogen.i read this in a blumberg report which i found interesting.
        i have no idea where rnf going to go however i think ill hold on to it.
        just look at uan.tnh,mon and the other chemical companies like dd,dow etc.
        all heavy into the ag market.
        less ariable land and a growing population.
        people have to eat and im not good at timing this stock.
        so ill just hang on.some ride.
        good investing to all
        dreiser 139

        Sentiment: Buy

      • Do you still own MWE ??? if yes,,which do you hold more of, if I may ask.

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