The last dividend was .39 and that was mainly due to a big increase in expenses. Oil prices were higher during that period of time on average and they had hedging so the drop was disturbing. The fact is that now oil is lower then it was a few months ago. The hedging is gone so you get no help there either. I think some big fund has done this end of the quarter calculation and decided that the dividend is going down this quarter and wants out. That is why we are seeing all this selling. By my calculation prices are down around 10% so yeah we can do .35 except that Nat gas prices have also fallen quite and bit and that figures into to it getting us to .33. Now if expenses drop we get .35-.38 but I would be cautious here.
1.60 probably isn't a bad guess but I would stay on the cautious side and say more like 1.40. Also, oil prices are not looking good right now. With all the geopolitical tension in the middle east right now and we still have low oil leads me to believe that oil could trade a lot lower going forward. I am out but wouldn't buy here even if I was looking to buy. I think it is better to wait until the divvy announcement and see what kind of hit there will be. Part of my money from the sale went into APL which has come down a bit, not really a pitch to buy, but with a divvy of over 7 percent that is likely grow vs a trust divvy that is likely to fall over time seems to me to be a better risk reward profile over the longer term. At the 12.26 price I am seeing now, the selling does seem overdone for what it is worth.
agreed. I am wondering if it is Kayne Anderson that is dumping. They are the only institution that could account for that type of volume. They typically will finish up by Friday. The problem with these small caps is one big institution dumping can really wreak the price.
The settlement period is 3 business days so i assume today will be the last day. It would make sense for someone who is looking to bottom fish to look at the stock near the close today or early tomorrow if you want a good price. Not recommending it but just saying.
The Street advice is for fools. Do your own do diligence. They are merely parrots for what the stock is doing now. Now that it has gone down, they are sure to say sell. When something has done well in the past they say buy. Any fool can buy a stock that is going up and say that it is going to go higher. BTW, this is a trust, big difference in the way a trust behaves and the way a company stock behaves. If you don't know the difference then you shouldn't be involved with VOC. VOC is the better of the trusts out there but still it is a trust and its future is terminal.
My guess is the big selling in VOC is done. It was an end of quarter thing. That is when these guys make the moves. The same goes for the broader market, I think. Really it was institutional dumping of the market to raise cash ahead of the end of the quarter.
That really is the issue with these. At this point, with current oil prices, you will be lucky to see a 1.40 annual distribution. Production and the dividend will drop annually. It might have a 20 year lifespan but at a greatly reduced dividend. In 10 years the distribution will be half what it is today. Right now I am projecting the yield somewhere between 12-13 percent. At that rate of return and realizing that is a top in yield at the current price, there are just better places to put my money. Also, you might read the prospectus more closely because the termination date is tied to total production and once they produce 10.6 Mboe then the trust terminates with no residual. They have already extracted a quarter of that amount.
Tried to warn you folks. Oil and Nat gas are in a near free fall. With all that is going on in the middle east we should have better pricing and don't. This is bad for VOC.
I certainly feel better. I bought a few more shares a week ago and was thinking I bought too soon but now I see some short sellers are really going to get roasted this a.m. and I am good.
I am holding on to my shares for now. The price could easily go higher and at the 1.5 points above Fridays close it is trading at at the moment, it is not really worth selling. The deal closes next year so you have 1 maybe 2 more dividend checks prior.
I added to my position when this briefly turned negative. Absolutely no reason not to own this near term. With the pending offer, there is a bit of a floor under the stock. A .62-.63 divvy is due next month. Should work its way back to 38 and there is always a chance at a raised offer.
I think the offer is based mostly on the Targa stock price so if the price of Targa continues to drop then the price of APL offer will drop. I think the point is that if a company that is in the business is willing to buy APL assets at 38 then the price of the shares are certainly north of where they are trading now. Shareholder are simply not going to be willing to part with their shares at 35 so the deal will not go through.
The deal will not go through if the price isn't there, bank on it. If Targa goes down too much they will have to sweeten the deal. There is a minimum amount that shareholders and management will accept and that is around 38. That is the floor. It is possible the deal could be abandoned.
BTW, I did sell half my position this a.m. mainly because I wanted to use the capital to buy some DAL. The selling in some of these airline stocks is ridiculous. They have pricing power and are levered to oil prices. The Ebola thing is way overdone.
You only lose if you sell. Sorry, I made to mistake of loading up on DAL this a.m. Yes, Ebola is going to churn the stock till it is over. Unless Ebola gets out of control, then it is just a scare to get people out of there investments. If it goes below 30, I will load up on more. No reason to sell, pricing power is there and falling oil prices are going to help earnings. When earnings are released on Thursday, folks are going to wish they hadn't sold.
Definitely a big buying opportunity for the Airlines. Lower fuel cost not only mean lower fuel cost for airlines but also more spending money for consumers as they spend less on gas. People are generally scared to buy the airlines because the belief is Ebola will get out of control and people will stop traveling. Ebola is pretty well contained and a vaccine is just around the corner. Still think another scare could drive this below 30 in a panic sell but long term this is going higher. 39? Oil was near 100 a barrel when this was hitting 40 so no reason this can't get to 40 with oil 20 percent lower. The oil market is 2 million barrels a day oversupplied but Saudi's are the only ones with the ability to cut 2 million out of production and they indicated that they won't. They are fine with 80 dollar a barrel oil.
Given the Microchip call, this was very good news as the MCHP soured the whole sector even though INTC is in a different league. Not only was it a beat but guidance was raised. Given the gloom and doom of slowing economy and currency havoc, this was an outstanding report.