Yes, a nice comeback until Monday came along. However, as I have stated before, this appears to be a buying opportunity brewing. No bad news and yet the stock is down over $2. Maybe the end of some Yorktown sellers after the last distribution. Technically, we could see a little more selling before it heads back up but we almost hit resistance at $74.42 today. Next resistance is $72.06. I expec the selling is done for now but we shall see.
speaking of Kinder Morgan, I noticed that a similar slide has plagued those shares. No real changes -- mgt appears to be executing the plans laid out at the beginning of the year, yet the shares seem to trickle down inexorably.
I am long a good chunk but believe in the soundness of the business model, the assets, and the management. Gas prices are down as well but as you know, earnings are tied to pipeline capacity subscription -- not gas prices or even gas volumes for the most part.
I have not seen any discussion regarding any interruption to oil production at SACROC and Yates so presumbably, that is going fine.
Yet the shares keep weakening. The multiple is now about 18x 2006E EPS of $5.00 vs. 16x EPS for the S&P 2006E EPS of about $80. The S&P is clearly the cheapest its been in a very long time and closing in on its historical average of 14-15x earnings. So the market perhaps should rally relative to KMI ...but KMI deserves to trade at a premium ...long term growth in EPS above the S&P at a fraction of the risk.
Seasonality in the stock price? Weak gas prices? KMI still seems to trade on gas prices irrespective of its goal of being price agnostic on commodities. Thoughts?
I think that you are talking about the North LIG project that got downsized due to Kinder Morgan not getting enough producers to sign on, to justify building a feeder pipeline into XTEX's N. LIG pipeline. Project is now slated at 80 million rather than 200 million as it is smaller now.
I wanted to indicate that it's not always a bad thing when the stock you are long is dropping.
If nothing has changed and the stock keeps moving down, it may signal an opportunity to buy some more. Assuming you have done your DD and you are convinced on the quality of the assets and the management team.
Well, apparently, today you got your wish and the stock moved up significantly. Let's hope tomorrow it it my day and the stock drops below $60 (my average price) :-) Who wouldn't be buying then!? Wouldn't you be thanking your good luck to find such a willing seller?
Good points. I was initially introduced to MLP's and GP's through KMP and KMI about 5 years ago. I made a killing on KMI rolled that cash into others like PLX, KSL and MWP and then XTXI. I think XTXI has excellent management. XTEX is a well run MLP and management owns a good chunk. I sometimes get too caught up in the day to day movements. I think the market will readjust as the dividends are increased at KMI and XTXI.
Thanks for the info. Haven't really had a chance to look at all of the volume, just looked at closing volume and compared to historical volume.
The fact that XTXI is down isn't all that surprising, it can't always go up and we've had a very good run over the last year. Its just that the pattern is very abnormal, down $2.00 one day, up $1.50 the next, down $2.00 again... The market seems to be undecided. This kind of movement might not be abnormal for a bulletin board stock, or a tech issue but for a company that is pretty well insulated from commodity exposure, has good organic growth plans and a good management team, its odd, again in my opinion.