XTXI is volatile, but the short term trend is down. Looks to me like a negative revaluation along with the rest of the GPs. XTXI is selling for 20X its estimated end of '07 $3.60 dividend, at which point it would yield 5% (3.60 / 73 = 5%). That looks like a good buy. Problem is that MGG, NRGP, and ETE are just as cheap, with 3 more GP's coming public in the next few months.
I am using this weakness in the sector as a buying opportunity, but I don't expect the selling pressure to end any time soon. Just keep buying and don't worry about it. If we own GPs yielding 5% as of Christmas 2007 that will not be the end of the world.
Focus on the underlying business and let the stock price take care of itself.
I still get the impression some of the traders and people invested in the GP's don't truly understand the limited partner setup etc. I agree that as long as the fundamental business stay on track the growth in dividends/distributions will continue and we'll all be glad we bought low.
I assume you're referring to the GP IPO's of APL, VLI, & ARLP. Seems like ARLP's potential GP IPO has been hanging over its head for a while. The way APL's been acting, I'd say something similar there. Depending on valuations when they IPO I'd have to say I'd be interested in all three. Citi says some good things about ARLP and it looks like their GP could be a good long term investment. Nothing wrong with a little coal to mix up the ol MLP stocking.
VLI's GP could come out fairly cheap and then look pretty good once they turn things around there a little. I'd need to read a little analysis before I dove into APL's GP. Been hard for me to figure out why one of the stronger growing MLP's trades at such a high yield. It has to be more than commodity exposure...
As far as existing GP's go, MGG has been the biggest loser lately so I've been buying there. Felt like ETE should have been going up given all the good news at ETP, so have been buying it too. If XTXI gets sub 70 it's going back on the buy list.
Being a GP of an MLP in the high splits is golden. As long as the MLP is managed properly and without undue risk, then the GP makes money hand over fist.
It looks like the market is saturated right now with MLPs, GPs, Closed End Funds that are buying MLP and GP equity etc and the IPO's continue.
The rising interest rates and rising MLP yields and higher acquisition multiples will dampen the accretion from buying assets, but organic growth seems to be the right direction. XTEX is headed in the right direction with its increased organic expansion plans. Hopefully they will be able to continue to push these plans forward to completion. They have just finished the North Texas Pipeline and already they are working on the expansion by adding additional compression and perhaps looping. I would also not that they are building a new gathering system to feed the pipeline.