According to the conference call there will be more cash available for additional purchases once financing of two of the acquisitions currently completed takes place. They expect to need additional capital in the third quarter of this year when they expect to go to the capital markets again.
NRF shot up after announcing that they will be spinning off the management part of the business, which is fee based and should yield about 5-6% rather than the 9% yield NRF had at the time. They have also been raising the dividend greatly over the last year, unlike RSO.
NEW YORK (TheStreet) - At the Harbor Investment Conference on Wednesday, Philip Hilal of Kingdon Capital Management pitched Energy Transfer Equity (ETE_), Stephen J. Errico of Locust Wood Capital Advisers spoke about NorthStar Realty Finance (NRF_), Liberty Interactive (LINTA_) and WMI Holdings and Blackstone's Jonathan Gray explained the PE giant's push into U.S. real estate.
Stephen Errico of Locust Wood Capital presented three stock picks: Northstar Realty Finance, Liberty Interactive and WMI Holdings. He said Northstar Realty's prospective spinoff of its asset management arm isn't being fully appreciated by investors. Meanwhile, Errico said he believes the firm's healthcare real estate investment trust, run by Jay Flaherty the former head of Healthcare Partners, may become far larger than the market expects.
I just read the first qtr press release again and noticed that they changed the method of computing DCF to only subtract maintenance and capex, the same way as LINE does it. Not good Now VNR is the only one that subtracts all expenses from DCF, unless they have changed it recently as well.
LGCY has both been extremely conservative and transparent in it's accounting, defining pretty much all capex as maintenance capex, and provides detailed DCF calculations in their quarterly statements.
The quality of the SA articles ranges from useless and completely wrong to some of the best financial analysis you can find. You have seen the bad. For the good, look for the recent article on MLPs by Factoids, who posts regularly on the Investor Village MLP board.
Since the GP has a large vested interest in the MLP, I think conversion will not occur until the last GP assets are dropped down in 2014. I expect that the price of those assets will be set low enough to increase DCF to a point where distribution coverage will allow the conversion to be done without driving the coverage ratio below 1.0. The very low price of the last dropdown confirms this idea.
I spoke to Investor Relations and told them about the confusion created by the announcement of the conversion to units. She will discuss it with managment and try to avoid a repeat in the future.
Exactly, they can only exchange the remaining 20% of the MIF that is left.
Since they have already exchanged 80% of the MIF, there is only 20% left. After the 20% goes, there is nothing left, period.
Since the Management Incentive Fee is based on the value of the assets of QRE, and that will go up will each acquisition, the exchange will have effect of keeping the Management Incentice Fee from rising in the future. This is good for the Unitholders in the same way that getting rid Of IDRs has been good for Unitholders of other MLPs.
They have given up 80% of the Managment Incentive Fee for all future quarters. This is worth about $3 milliion per quarter and has no effect on the distribution coverage. So for next quarter, the Management Incentive fee will be about 750k instead of 3.7 million. At 50cents per quarter, 6 million units will get 3milliion/per quarter of distribution, so it is a wash. There is no effect on unitholders at all.
The NY conference hedge numbers are: Total oil and NG hedged in 2013 is 94%. In 2014 it is 89%. In 2015 it is 77% and in 2016 it is 61%. I made the mistake of using older hedge numbers. I trust these are more current. This is still the best E&P MLP hedge book after that of LINE.
QRE is 93% hedged in 2015. In 2016 the hedge coverage drops to 63%. QRE's hedge book is second only to LINE's
EVEP holds 159000 acres in the Utica. That is 30% of what Enervest holds. So a good guess is around 2 billion. The wildcard is the quality of the acreage in the two holdings. It is possible that the EVEP holdings are more concentrated in the oily areas of the Utica and could be worth more than 2 billion.