What do you experts make of the langthy article from SEeking Alpha author about SDT being overvalued and will see steadily lower distributions. Hope this does not make our stock price tank as similar articles did for the Whiting trust not too long ago.
Article is nonsense, nonetheless there is a strong interest in some big players in pushing SDT down and its working. For example they tried to claim that 100% of the natgas is hedged, thats not true and is a blatant lie.
Posts saying the article is "nonsense" or "garbage" just show that you have no idea how to evaluate the author's claims, imo.
The author laid out some facts and some assumptions and came to a conclusion.
He may or may not be correct, but the reasoning and assumptions were explained, so I don't consider it nonsense or garbage.
And in my opinion a writer who is short has more credibility than one with no position. After all, if he strongly believes what he wrote, it is only logical for him to be short. That makes it more valuable than something written by someone who doesn't have the courage of his convictions to put any money behind it.
As you can see from postings above this , the SA analysis is pure garbage . Author assumes $2.70 nat gas vs $3.30 where it is now and his NPV assumes 10% discount rate in a world where even 5% discount rate is harsh with 10yr at 1.65% and junk bonds trading at 5% .
To the short's credit , he lays out all his assumptions . The panicked idiots who sold down to $21 todayt will feel awfully stupid when they see using $3.30 nat gas in base and a 5% discount rate and his same analysis would get you north of $30 valuation .
Lousy article IMO, way too early yet for the pessimism. I have bought today @ 21.60 to take advantage of this selloff and get an even greater yield. There will be a time to sell, but IMO that time is NOT now.
Rusty, it must be Obama's fault? I think it has something to do with his birth certificate. A secret message to short SDT. You know they never could find the doctor who signed the certificate. They think he is in the USSR. I just love starting conspiracies.
SDT will be up tomorrow.
Actually since the fiscal cliff and dividends being subject and taxed as regular income causes many to sell off the trust and depending on the election outcome will either be happy they bailed or jump back in should Romney pull an upset according to all these pollsters. hehehe! Lots of big money going to the sidelines like 2008 and we'll see what happens to make it come back or really fall BIG TIME! MM's are just playing and we'll see who wins and who loses. As for Obama, who gives a shhhhhh what house he was born in but rather what house re resides in now. Who sang that song 25 or 6 til 4? Perhaps the Prez will enjoy it there.I suspect he will move to Hawaii and his staff will remove all the R's on their keyboards. Romney, Ryan, and Republican! The three R's that students will be studying the next decade!
SA should be taken off these boards - its just a paid pump and dump scheme like the paid bashers on the board. The stock market is loaded against the retail investor enough already....
Sentiment: Strong Buy
We are taking it on the chin to day. Assume that article in SA has that much power. I understand the concept but if we use something other than PV-10 (which might be in order with the new world we have for relative spread on interest rates over bonds and US Government securities), the trusts (not just this one) might not be overvalued. Actually, to keep a yield spread between other securities competing for investor money, royalty trusts need to trade much higher than they do now. It is a push and pull but the shorts have control with no uptick rule to keep them in check when stocks are out of favor.