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Enterprise Products Partners L.P. Message Board

  • worker10 worker10 Dec 16, 1998 3:47 PM Flag

    Safety of Dividend?

    I am also an owner of this stock, based on my
    broker's recommendation. I understand that the dividends
    to the controlling shareholders who have 80% or so
    are subordinated to the other shareholders's
    dividends for a few years. I have not seen this provision
    in writing, and do not know the mechanics of the
    deal (for instance, whether the subordination is
    cumulative). I would be interested in knowing anyone's views
    on the management team runnning the business.

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    • There's a reason for the Dilbert cartoon where
      Dogbert says "prospectus is another word for open your
      mouth and close your eyes". This is basically a private
      company where the founder is cashing out, retaining
      control while he builds his empire with other people's
      (read your) money. That said, they have a reputation
      for being pretty savvy on structuring their deals by
      bringing in partners to share the risk. But, the health of
      their business depends on the health of the petchem and
      refining industries who use their transportation and
      feedstock processing services and the gas companies who
      produce the products they handle. To the extent that they
      have competition it will drive their fees and revenue
      stream down even if their volumes hold steady. I would
      buy it at a low number (14 to 15, say) for the
      dividend yield but wouldn't count on a big price runup.
      Watch the insider info. on this one very closely.

    • I'm in charge of my mother's stocks --- all of
      which are high risk, and big yields in order to give
      her a continuing monthly supply of money for nurses,
      etc. I'm very confused about EPD, but I just got a big
      folder from them which I must peruse. I assume that's
      the 1065 you're referring to.
      You're the first
      person I've seen take notice in I don't know when. My
      broker told me it was a very solid stock, and, to be
      sure, we've been receiving regular dividend checks, so
      I can't complain, but I sure don't know what to
      make of this company. I have no way of making a
      prediction, either. I'm not getting out of it, because
      there's no need to -- if they continue to pay out, but
      her entire portfolio is down, and all of her stocks
      are like this.
      I must also assume this is a
      momentary trend. My broker says, "Relax, I worry too much."
      Is he right?

    • My broker put me into EPD at the IPO. I didn't
      realize it until I
      received a form 1065 on Saturday,
      March 20th--after I had filed my taxes. Okay, so I'm
      here and underwater.
      Now, what makes this company
      tick? Anyone have any prospects?
      If they pay
      attention to their interal workings like they issue their
      1065's, we all are in big trouble. What gives? Hold, buy
      or sell?
      My broker hasn't stubbed my toe too
      many times. But other than the 1065s, I haven't
      received anything from EPD. Please post info.

    • You are correct for I think three yrs general
      partners distributions are suborinated to the general
      I have spoken to the company who feel there is
      little or no chance of lowering the dividend, and their
      betting is it will be increased toward the end of 99.

      • 1 Reply to worhol
      • Oil prices have only a marginal impact on this
        liquids processor. They have most of their vols under
        longterm contracts. Their key to profit is effiency of
        production. Prior post correct that owners div's are
        subordinated to limited partners for 3 years.

        recent MLP is "PAA" which is yielding around 10%. they
        are primarily is pipeline trans and storage. Most of
        the seasoned MLP's such as TPP and Buckeye are
        yielding 7-9%

26.07-0.40(-1.49%)Oct 27 4:02 PMEDT