I posted these stats at the end of Q2 [end of June] for MLPs with the strongest distribution growth year to date:
The following companies had distribution increases of greater than 3% from Q1-06 to Q2-06 : BWP, CPNO, ETP, HLND, MWE, OKS, SXL, TLP, VLI, WPZ, XTEX, and TGP. Their mean price gain for the year is 12.05%. Their mean total return for the year is 15.12% - and 7 of the 12 beat the sector average yearly price gain [7.24%].
The following companies had distribution increases of less than 3% : APL, BPL, EEP, EPD, HEP, KMP, MMP, PAA, PPX, TCLP, TPP, KSP, MMLP, and USS. Their mean price gain for the year is 2.17%. Their mean total return for the year is 5.87% - and 3 of the 14 beat the sector average yearly price gain.
By now, nearly all MLPs that are increasing their Q3 distributions have announced that change. So how has the Q3 class of distribution achievers performed year to date? [stats are for perfomance up to 8-04-06]
The following companies had distribution increases of greater than 3% from Q2-06 to Q3-06 : BPL, BWP, CPNO, ETP, HLND, MWE, OKS, SXL, WPZ. Their mean price gain for the year is 20.67%. Their mean total return for the year is 24.4% - and 6 of the 9 beat the sector average yearly price gain [11.67%].
The following companies had distribution increases of less than 3% : APL, EEP, EPD, HEP, KMP, MMP, PAA, PPX, TCLP, TLP, TPP, VLI, XTEX, KSP, MMLP, TGP, USS. Their mean price gain for the year is 6.9%. Their mean total return for the year is 10.54% - and 3 of the 17 beat the sector average yearly price gain.
Why do these stats matter to ETP unit holders? Not only has ETP increased their distribution at a faster pace than average in the past, it is expected to continue at that pace.
Re to: factoid
"Not only has ETP increased their distribution at a faster pace than average in the past, it is expected to continue at that pace."
For many of us, security is diversity, is holding several MLP's.
I own KMP, ETP, EPD, APL, MLP, PAA.
For the year to date, including distributions the group is up +18.1%. 12.1% in unit price. At this pace, the unit price of the group will grow such the yield to new buyers will be on the way to 6%.
I think the unit price growth is a bit fast this year. OH yes, the S&P500 is +2.5% for the year.
I only own 2 stocks and one GLH has a return of +21% for 12 months. Not many companies pay 5% yield. Hard to find a company that can compete with the pipelines. IMHO.
Thanks for your inputs.
Appreciate your discipline. My wquestion is how many of our newbie MLPs are approaching your 5 year threshhold? MWE will be 5 on September 25th of next year. IF you have a list of those that are anywhere from 4 years to almost 5 years old it would be both interesting and of great assistance to me to look at your findings.
Charty wrote: " own KMP, ETP, EPD, APL, MLP, PAA.
For the year to date, including distributions the group is up +18.1% [in total return and up] 12.1% in unit price.
Year to date, the non-cap weighted return of pipline MLPs in my coverage universe [which includes APL BPL BWP CPNO EEP EPD ETP HEP HLND KMP MMP MWE OKS PAA PPX SXL TCLP TLP TPP VLI WPZ XTEX] is up 13.60% with a total return of 17.05% - and the total return would be higher if I credited distributions on date of record and not date of payment. That could explain why my sector average numbers have a better unit price return than Chart's portfolio, but a lower total return.
Chart, I have argued before that your anti-newbie bias [Chart only buys MLPs with a 5 year record of distributions] is going to work against you one day [or year]. Looks like 2006 is one of those years. But if I could calculate risk adjusted returns [heck if I know how], then maybe your portfolio would beat sector average on that figure.
The thing is, Chart has a system, a system that works most of the time, a great sell disopline, and it lets him sleep well at night. It is a rare day that I pick to poke a little fun at Chart [my portfolio is outperforming his! - and his is very close to 'average'.] So I would be neglecting my ego if I did not let that little factoid slip out.
But if one can live with an avearage performance every once in a while, and superior performance the majority of the time, then y'all should go on listening to Chart's adivce. [Hope y'all know I'm grining as I write this - but some folks just don't get Texas humor - and these words could be lost on them.]
Thanks for the info. For ETP to be back to a distribution of 7% they would have to end the year at a rate of $3.15. As a holder when they were Heritage I would be extremely happy with that. I would appreciate any comments.
I believe you should re-state your question, because I am not sure what you are asking. Will ETP fall to a 7% yield? Not when it is growing distributions this fast - and it does not look like it is slowing [much] in the next two years.
If the question is WHEN will ETP be paying out distributions at the rate of $3.15/annum - then I would go with the analyst estimates - which are conservative [based on the accuracy of past projections]. Both AG Edwards and Citi project the 2007 payout at $3.00 - which I beleive to be about 4 cents too low, and even $3.04 could prove to be too conservative.
2006 Distributions: 55 59 64 67 = 2.45
2007 Distributions: 69 73 77 81 = 3.00
So getting back to the question of WHEN will ETP be paying out distributions at the rate of $3.15/annum or 78.75 cents per quarter - probably around the third quarter of 2007 - or one year from now.
The Citi projections for distributions in 2008 is $3.60, for 2009 is $3.95, for 2010 is $4.25.
Enterprisers39, if you are not a member of the Yahoo mlp_research group [if you do not have access to these estimates already - and I beleive more than half of us are already members of the group], then you should join up.