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Crosstex Energy, AŞ Message Board

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  • rrb1981 rrb1981 Jan 6, 2006 8:20 PM Flag

    GP Tax and Cost of Capital

    We should be seeing the announcement around 1/20-1/25 timeframe. As for guesses, well, I say this, we know that they have mentioned in past conference calls a dividend of close to $3.00 by year end 2006. I take that to mean $2.92. That means that they have to raise the dividend by $1.08 over the next 4 Q's. That comes out to a quarterly increase of .27. I would imagine that it will be more or less evenly spread out over the year. So, I would not be surprised to see a dividend announcement that puts the dividend at .52. One thing to keep in mind is that if the Barnett Shale pipeline is not in service yet, then the aggressive increases might not kick in till 1Q06.

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    • My prediction is a little lower given that: 1) part of the Q3 dividends included DCF from the sale of an unutilized asset and that bumped it to $0.46 from $0.43, 2) North Texas Pipeline is projected to be on in the first quarter of '06 and 3) Crosstex had some volume issues related to the hurricanes which I believe are now fixed. # 2 and #3 will be good for first quarter 2006 divs but not Q4 2005. I expect a raise to $0.49 or $.50.

      I still think $3.00 is achievable but we will probably see it layered more like Q1-$0.56, Q2-$0.62, Q3-$0.68 and Q4 2006, payable in Feb 2007, at $0.75 for the quarter which gets us to $3.00 annual. With a $3% yield, that's a $100 stock price. Here's to all the longs.