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Crosstex Energy, AŞ Message Board

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  • sierratrekker48 sierratrekker48 Apr 12, 2006 4:12 PM Flag

    we seem to be back to where we were


    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?