You have to admit that today's action made NO sense. Up 1.86% Come on...it is NEVER up that much in 1 day.
If NS goes up by that much there are forces going on behind the scenes that we can only begin to imagine. When the impossible is suddenly possible, it is ALWAYS too good to be true.
My advice...let the exilaration of the 1.86% settle in tonight....Yes, it might be difficult sleeping because of the excitement...but a good night's rest will give some clarity to the situation and allow us all to see through this emotional time.
Yes, it was amazing to see this pop....simply amazing....but until I have a reason why it exploded higher, I have no choice but to wait until the 30's to add to my position.
It's ridiculously obvious why NS went up 1.86% today. It went up for the same reason that it has been going down - capital outflows (or, in this case, an inflow) into the sector.
ETP was up 2.08% today. SXL was up 1.99%. EPD was up 3.06%. MMP was up 1.07%. XTEX was up 3.72%. Etc. etc..
NS has been beaten up over the last year...as has MMP, XTEX, and almost every other MLP out there. It's actually done slightly better in 2008 than some other well-run MLPs like MMP (which kind of throws a damper on the "everyone is panicked about the asphalt acquisition" theory.)
All of the MLPs have been beaten up recently. Almost all of them made significant moves upward today. I have been buying many of them while they've been getting annihilated. As previously noted, I was recently buying more NSH at $18.40. I think that the third quarter is going to be very good and you'll be looking back at this period and wondering why you did not buy.
In general, though, NS won't revisit its 2007 highs until the sector as a whole begins to recover. That probably won't happen until some of the fear in the marketplace subsides. While in general the temporary (1-2 years, give or take) decline in MLP prices is irrelevant if you don't plan to sell, it does mean more dilution for the LP unit holders (since when attempting to raise capital it will need to sell more units at the lower price to obtain the same amount of financing.) That's part of the reason why I've been gradually shifting towards the general partners (like NSH and MGG) or the GP/LP combinations (like MWE and CPNO.) Those things are now sporting awesome yields - in many cases, they're yielding what the LPs were a year or so ago...but with greater leverage and therefore growth possibilities.