Everything sounded good EXCEPT They mentioned a number of times they just raised the dividend in December numerous times--And they mentioned their policy of raising the dividend once a year. I interpret that to mean they will not raise the dividend until the December 2015 dividend.. I assume that means they won't increase before December--But after toing all the book work to get the year end figures together and presented I would assume they would declare the upcoming dividend before today's conference call or at the latest today on the call. It isn't necessary to keep repeating about raising the dividend last quarter and say nothing about the next dividend "supposedly" coming in April. Or if they wanted to create excitement they should have raised a penny in December and increased a penny every quarter going forward.
A lot they could have done to distinguish HASI from others--But they didn't --They announced yesterday they are going to present at 3 conferences in the next week to tell their story. The story I want to hear is WHEN IS THE NEXT DIVIDEND and WHEN IS THAT DIVIDEND GOING TO BE RAISED AGAIN..
---Scheduled for Tuesday after the market close. HASI just issued a Press Release this evening that HASI will be attending the following Conferences--
1)UBS Utilities and Natural Gas Conference on Wednesday March 4, 2015 in Boston Mass.
2)Morgan Stanley MLP/Diversified Natural Gas, Utilities & Clean Tech Conference on Thursday March 5, 2015 in NY NY
3) 27th Annual ROTH Capital Conference on Tuesday March 10 2015 in Niguel, Ca
The Roth Conference presentation is scheduled for 2:30 pm Pacific time and a webcast will be available on the company website for 90 days.
I would expect good news to be coming out tomorrow on the conference call and management wants to get the word out to as many analysts , bankers and investors that they can.
They probably envision a major growth phase ahead of them .
That's not exactly true. Back in May 2014 GAB was trading at around $7.90. If he "Was right on the Money" he would have sold around that time not a $1.00 lower a few months later as he did.
Actually no one really knows what public investors will do and when they will do it.
At this point in time GAB is selling about 15% lower than the $7.90 level of May 2014. It might go lower but it is safer here at 15% lower. Another point GAB used to trade at about a 10% premium to NAV for many years and now trades at about a 4% discount.
I believe it is closer to a buy at this time than a sell and I have been buying recently
I'm still dripping-DNP drips the shares at an up to 5% discount to NAV.
I am adding new money to GAB which for many years has traded at a 10+% premium to to NAV Last year they had a rights offering (That was fully subscribed) and the share price dropped to a current 3.7% discount. They pay quarterly. And they pay about 10% per year.
NMB: I have ---and like what I see---- so I have been buying and adding on the quick dips that I've been watching for.. now looking for the PR and CC on Tuesday.
If the spin-offs are successful and raise the total share price of the spun off entities we will not want to buy back shares because there would be little or no discount to NAV.
If they aren't buying back Dollar bills for 80 cents currently why would they want to buy back dollar bills for $1.00 or more later. If that scenario exists, that would be the time to pay the maximum cash dividend to shareholders to raise the share price.
By the way thats what the ACAS scenario was up until the meltdown in late 2008.
In Wednesday's ACAS conference call Malon Wilkus said---
===So if it wasn't for the spin-offs, I think we would likely still be in a program of buying back shares. This is a very big discount. We believe in ourselves. We believe in our assets. We have proven that our assets are worth a heck of a lot more than what the market is causing our stock to trade at, so we are believers in it. But we're also believers in the spinoff and the value enhancement that can come from it. So it is a balancing act and if there's an opportunity to do both, we will consider doing that very, very seriously. - CEO Malon Wilkus, 2/25/2014===
It appears that all the reasons for halting the buy-backs like buying too many-not enough outstanding shares after -too many options-not enough shares were really all a bunch of baloney. The real reason was to keep the AUM high and create additional fees for management compensation, and let the share price take care of
====We received guidance for 2015 and 2016 that was down from prior guidance and a crystal ball number for the next 4 years. Hope it comes true. BUT, in the last 3 years MWE has pushed back and LOWERED GUIDANCE EVERY YEAR. FWIW, MWE is my 3rd largest stock holding. Have added about 20% to it in the last 6 months. Am now maxxed out. ====
I'm curious as to why you added about 20% more MWE units in the last 6 months if MWE has pushed back and lowered guidance every year for the past three years.
I agree they have pushed back guidance the last 3 years on raising the distribution increase rate above the $0.01 per quarter.
===About 1/2 of that from renegotiation of construction contracts and 1/2 pushing back on plan dates. Nothing cut. No real reduction in plants.===
Yes- Nothing Cut- no real reduction in plants--
EXCEPT-- MWE is projecting about a total of about $800M reduction in 2015-2016 Cap-Ex spending.And at the same time they are projecting an increased distribution rate of about 60+%
(From $3.60 to $5.80) in 5 years.
Considering a number of MLPs have reduced distributions and the world market price for oil and gas has collapsed about 50% I would say that the current guidance from Frank Semple is more than I expected.
Slide #27 in the November 2014 Investor presentation MWE forecast 2015 expenditures of $1.8 to $2.3 Billion and the forecast for 2016 was $2 Billion.
In yesterday's press release they said:
Revised 2015 capital forecast to a range of $1.5 billion to $1.9 billion, and 2016 forecast to approximately $1.5 billion to align with producer's current drilling programs.
That's about $800M less spending projected for 2015 and 2016.
ARB: it's not my crystal ball-That's Frank Semple's crystal ball.
He's the one that said the following in the Press Release
+++The Partnership forecasts distributions of APPROXIMATELY $3.70 for 2015, $3.97 for 2016 and an annual growth rate of 10% for 2017 to 2020.++++
I can live with the $0.01 increase each quarter for the next year. It appears the market agrees with me--since they have bid up MWE units about $4.50 as I'm writing this---And that's about 5 quarters worth of distributions
Last distribution was $0.90 Annual rate $3.60. A $3.70 for 2015 (includes Feb 2016) is a one penny increase per quarter.
A $3.97 distribution for 2016 (Includes Feb 2017) would mean increases of .02-.02-.02-.03 to get to the total $3.97
Its fuzzy after that but about a $0.03 increase per quarter for 2018-19-20.
Of course we all know things are subject to change in the future.
Leny: Actually he probably " knows" as little as we do. Just someone with some money in his pocket that is looking to take a gamble with. Red or Black on the roulette table requires the same insight and can give the same results.
NMB: We can make it as complicated or simple as we want. We can also lower our overall "bagger" by adding to our investment as and if the price and (tax deferred) distribution continues to rise by adding more shares as funds permit. Sometimes this can be accomplished by selling a position in a losing position and upgrading ones portfolio (If one has a losing position to sell)
That would lower the "bagger" and "total return% per year" but it would increase my "net income" Then I would have the option to either spend the "money" received or if I don't need it I can reinvest the "money" into additional shares to create more "money" that hopefully I won't need.
I believe it is better to create money I don't need then to be short money for necessities that I do need, but can't afford because I don't have it
With companies like Citigroup and Warren Buffett's MidAmerican Energy Holdings Co Involved and Invested in the same arena, a tiny company like HASI is really just a "Rounding Error" on their books. We always talk about the problems of growing large numbers because they are so large to start with. HASI on the small end of the spectrum has the potential of being a multiple bagger from here. The risk here is if they trip over their own feet, not that they are too large to grow. At the current $400 M market cap-- Every $1B Market Cap is a 2.5 Bagger from here-In addition it pays a current 6.4% annual distribution that is about 95% tax deferred. Those are probably reasons why people are piling in to be part of it just like Citigroup and Warren Buffett.
The risk reward of the industry appears good, and IMHO HASI looks like it has the potential to be a winner as a buyout candidate and if they can stay independent an even bigger winner for us
Patience--Waiting can be the hardest thing to do.
In addition to growing, HASI will have to be very careful of the sharks that will be circling in the water as they show more progress as they move forward.
The problems I have found over the years with small cap stocks is when they show signs of being successful, the big fish snap them up giving the early public investors a small premium to shut them up as they steal all the future promise for themselves leaving us with a big tax bill to pay.
Bloomberg Business published on Feb 18, 2005 a PR entitled "Citigroup Sets $100Billion Funding Goal For Green Projects" written by Ehren Gooseens. Not specific to HASI but definitely specific to the type of projects that HASI is involved with.
It appears we are in near the beginning of the growth cycle with a huge amount of growth to come.
You will receive a 1099.
They paid $0.06 a month for the first 11 years. Then they increased to $0.065 a month for the next 17 years and thats what they are currently paying.
Someone besides me believes that HASI has a very bright future and has been adding shares as it moves up 30 years experience in the business. They went public less than 2 years ago. They have raised the dividend 3 times in that 22 month period. Their business appears to be in a field that is unlimited and very politically correct.
And last but not least their distribution is geared to be mostly tax deferred so more money can be spent by the investor and not the government ---or--- if the income is not currently needed it can be dripped into additional shares to compound the growth.