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Energy Transfer Partners, L.P. Message Board

bbandassoc 70 posts  |  Last Activity: Dec 16, 2014 8:08 PM Member since: May 31, 2011
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  • Reply to

    Curious, Does management Ever Defend This Dog?

    by bom_fritte Oct 29, 2014 3:43 PM
    bbandassoc bbandassoc Oct 29, 2014 4:36 PM Flag

    Yes, they speak at conferences. And, just this past month they stated at a conference that they will achieve their financial goals, despite the drop in iron ore prices. They have also said they have more assets to sell than they can accomplish at one time. They convincingly claim that with higher volumes, lower costs and the sale of assets that the dividend is safe. Of course, they don't believe IO prices will continue to decline, so if they were to, then, the basis of their projections disappears. Personally, I think IO prices are likely to either settle in here or move a bit higher and VALE will increase cash flow moving forward with higher volumes and lower costs as well as the sale of assets. I wish they would use some proceeds from an asset sale to buy back stock, but they have a history of preferring special dividends rather than buy-backs and in the current environment would likely be best served tucking any monies from assets sales away just in case.

  • bbandassoc by bbandassoc Oct 29, 2014 8:53 AM Flag

    CS clients have been short for some time now and with Chanos acknowledging he doesn't see the risk/reward in shorting Brazil anymore and beating the upcoming rush to cover, this note is nothing more than an attempt to give CS clients a chance to cover before a bounce.

  • Reply to

    It's already rebounding.

    by gerrys_h Oct 28, 2014 8:24 PM
    bbandassoc bbandassoc Oct 28, 2014 9:05 PM Flag

    I will take my gain and wait to see. Bought 10K shares in after-market at $72.25 and sold at $74.15. The analysts will have no choice other than to reduce their 2015 estimates and PT's due to much, much higher than anticipated spending and a slow down in growth. So, there will me more trading opportunities in the coming days without taking the risk of holding the shares.

  • bbandassoc bbandassoc Oct 27, 2014 8:15 PM Flag

    The only hope Dilma has to stem the tide quickly is to appoint ministers in charge of finance, oil and mining who will put a new face on her administration and show she is serious about change. Any actual policy moves will take time to negotiate. If she demonstrates she is serious about a new direction with these appointments, the markets will respond. But, if she fails to impress with these appointments, then, it will show she has no intention of changing her ways and it's going to be a very, very long presidential term for the financial markets (like the last one didn't seemingly last forever for investors in Brazil).

  • bbandassoc bbandassoc Oct 27, 2014 7:40 PM Flag

    I own LINE and LNCO and I am not concerned at the moment due to hedging. And, it's hard to get too concerned about longer term because if LINE can't make money on capital non-intensive drilling, then, who can? But, as we get into 2016 when the oil hedges are running thin and the NG hedges only have another year or so, we had better have a lot of accretive acquisitions to fill the hedge gap, or prices had better be higher to support renewed hedges at better than today's prices.

  • Reply to

    Brazil, dumbest country of the year award

    by mikemakeavoice Oct 27, 2014 9:39 AM
    bbandassoc bbandassoc Oct 27, 2014 5:01 PM Flag

    Democracies (I use that term loosely) have learned in the U.S. and now Brazil that affording people to vote themselves a free lunch is a death spiral that will only end when the free lunch ends because there is no longer any money to pay for it. In the U.S., the Fed propped up the stock market and the economy in the face of an entirely incompetent president, but Brazil doesn't have that luxury.

  • Reply to

    VALE just blew through the 5 year low.

    by cash.mccall Oct 27, 2014 12:06 PM
    bbandassoc bbandassoc Oct 27, 2014 4:57 PM Flag

    I enjoy your perspective and share many of your concerns about the potential for the government to exert more rather than less control over a profitable company, like VALE, and a lack of comfort with where the stock price may settle in the current environment. But, the cup half full look at VALE goes like this.

    Rousseff must change her ways. She isn't unaware that her policies, if continued, will drive Brazil into an economic abyss. As such, I think she will make some adjustments that could be very favorable to the overall mood toward investing in Brazil. Immediately, she can make appointments of key people who the market will like for the open finance and energy roles. If she doesn't, she will be dead before she starts her second term. That said, VALE on its own should be bottoming out as a stock here. They are about to embark on a major increase in production at lower costs in the coming quarters; a planned 50% increase by 2018 at costs as low as $15. The VALEMAX ships and forgiveness of the 9% Brazilian tax that Brazil was struggling to collect anyway will also have near-term benefits to the P&L. Even at the current price, this will increase cash flow and earnings substantially as expenses are lower with a weakened Real and capital investments wane. If higher cost producers do exit en masse, then, VALE will be highly levered to take advantage of any increase in prices with lower costs and much higher volumes. Being a cup half full kinda guy, I will remain patient with my shares at a $13.50 cost basis and only add should the price drop as you suggest it might. GLTA

  • Reply to

    Weak Hands

    by mubochi Oct 27, 2014 5:22 AM
    bbandassoc bbandassoc Oct 27, 2014 6:06 AM Flag

    While the ETF's and VALE along with them will take a hit today, exporters are predicted by analysts and fund managers to do quite well due to the continued devaluation of the Real. For VALE, the only direct P&L impact of the election is that the Real is expected to be devalued another 10% or so and it drives down VALE's costs since they sell in US$ and most expenses are in Real.

  • Reply to

    Rousseff Wins, It's not the end of the world

    by ameanhass Oct 26, 2014 9:09 PM
    bbandassoc bbandassoc Oct 26, 2014 9:37 PM Flag

    Yes, but I also see that Brazilian ETF is down 6% in Asian trading, so it does appear we will get an early hit that, at minimum, gives back Friday's gains on the optimism over the Neves poll. Still, if I were trading VALE, I would have sold Friday when it ran over 5%, but I see it as a good long-term investment and will watch the drama unfold, even though I am not in the market to buy more unless it gets ridiculously cheap at this point. My average price is $13.50.

  • Reply to

    Rousseff Wins, It's not the end of the world

    by ameanhass Oct 26, 2014 9:09 PM
    bbandassoc bbandassoc Oct 26, 2014 9:24 PM Flag

    IMO, while the Real may decline tomorrow, I wouldn't be surprised to see Brazilian equities rise. A weaker Real is good for Brazilian companies and VALE is no exception. Besides, the outcome of this election is not a surprise to the markets and has already been priced into stocks, except for the few who bought Friday for a trade based no what professional investors knew was a biased poll by Neves campaign. Like you though, regardless of what happens in the coming days or weeks, I think VALE has the potential to be a big winner in the coming months and years with a 50% increase in production and lower operating and capital costs. When iron ore prices ultimately rise (as they will), it could be a triple or quadruple from here while the downside is seemingly minimal.

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