Recently,wells fargo reiterated it's outperform rating and concluded the recent market loss was unjustified.there are too many obvious shorts on this board.at this price, lre is the best mlp bargain in the market.
REALLY? BASED ON YIELD?
BASED ON LONG LIVED RESERVES? HEDGES? QUALITY MANAGEMENT?
These guys are now looking at a 15% yield. How many accretive acquisitions will they be making with equity that costs 15%????
BTW, I'm not a short...but I do suspect you are correct that many are shorting LRE. Not even the yield will protect a crappy product like LRE from being gutted by the market.
RJ made a call that oil is going to $60. They downgraded about 20 names and LRE was one of those names. So the downgrade was a sector call not LRE specific. It is a great buying opportunity in my opinion.
Too bad that the other E&P MLPs were down a lot less than LRE.
LRE is down significantly because the market can see through the sham that is Lime Rock Resources.
LRE is nothing more than a dumping grounds for end of life properties that LRR has already milked.
Look at the pathetic R/P. Look at the hedge book. Look at the last acquisition. How about buying a high R/P property that will boost reserves.
This MLP is going to have a very tough time making future acquisitions with a equity cost of capital over 13%
I'm sure management thought they could pull one over on Wall Street and try to float a bunch of has been properties and the "retail" investors would lap it up...ummm sorry guys...quite a few alternatives with much better coverage ratios, better hedges, better reserves, geographic diversity and a track record!