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Magellan Midstream Partners LP Message Board

  • mo_scuba mo_scuba Dec 19, 2008 8:26 PM Flag

    Keep the powder dry until Q4 earnings

    Q4 will show the commodity price impact on earnings. I'm thinking Eps down up to 25% (guess as there's no way to spread their statements in such a way).

    Then watch for money coming in.

    Money flow may start soon but the big money will most likely not appear until after earnings and most likely not until Q2 IF indicators show the recession is at the bottom. Money flow into the market precedes the end of a recession and it gets parked in this type of investment.

    I hope they give up the consideration of more ethanol investments. Even if fee income, a BKY ethanol customer is a bad one.

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    • Actually, I expect gasoline consumption to be down on the order of around 5%-7%. The sudden drop in prices is helping restore the previous demand destruction. Also, just to let you know, they are blending ethanol for the distributor, not the ethanol producer. Since, Magellan is presumably purchasing the ethanol and then blending it and then billing for the cost of the ethanol plus the blending fee (remember, it is a cost plus service), they should have very little risk to ethanol producers going bk.

    • Talk about "political pork"...ethyl alcohol is it. 1) There is NO WAY ethyl alcohol made from corn can compete with ethyl alcohol made from sugar cane in Brazil.Mexico etc. 2)The USA even has to subsidize sugar production in the USA. 3)sugar cane production in Florida is screwing the Everglades,contaminating groundwater,and putting chemicals in the ocean. 4)There's a tariff on imported ethyl alcohol 5) the ethyl alcohol producers want subsidies to build plants 6)MMP is looking for Fed $$s to build the pipeline...Unbelievable!! And Obama sez ethyl alcohol is good...representing a corn state like Illinois and winning early in corn crazy Iowa results in strange results!

 
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