Sure make your case, but for the record you are the one that brought up my solvency, which has everything to do with short term (liquidity) and longterm ( net worth ). Neither is an issue for me, so your comment was specious or was it introspective and projecting?
SDLP is not going to have a distribution cut for at least three years, if even then. If things are rough at the parent, they may drop down more rigs at better prices to allow the distribution to remain the same or even grow and rig pricing may improve by then.
I tend to buy when everyone else is selling especially in panics, and I always buy stuff with a dividend. If I can convince myself that the dividend/distribution is secure, that is. I cant tell long term future of drilling rig pricing, other than to say that ultimately current supply is used up and there will be demand for new sources. I think that comes before 2017, but if it doesn't an almost 12% yield gives some margin for error against historical yields, at least. YMMV
The company has guided to a bump of $.035-$.04 per qtr increase in the current distribution of $2.21. Its not declared yet, but mgt has provided that guidance. Insider buys back that up as well.
Medium term absolutely. First significant lease rolls in 2017, I believe. Longer term will have a lot to do with how long rig lease rates stay down. Of course what always happens in these situations is that older rigs are retired and sold for scrap, and the supply and demand equalize.
Your concern with my solvency is touching. But the truth of the matter is, you have no idea of my liquidity, net worth or anything else about me. But I would be happy to measure mine against yours, with the winner shutting up big time for awhile.
I am riding with the shooter on this one, in at $18.76. Markets do funny things, but I wont be selling. Clipping coupons on the distribution which they have guided ( all but declared) to $2.35 - $2.37 starting this QTR. That is over 12% on 11 AM price of $19.45. We are discounting payment streams from counterparty the strength of Exxon so I find the yield silly but happy to cashier it.
I have contacted shareholder relations, I assume they are swamped but am also sure they will eventually get back to me. Any clarity they provide I will post.
I am glad you are so sure. I being a simple CPA, have no idea on the tax treatment other than long experience in business combinations when I was practicing, and lots of "sales" are not treated as sales for IRS purposes, but rather business combinations. In some instances, its treated as a hybrid, where the stock is treated like a combination, and the cash "boot" is taxed. I have no idea what they did here, and given the paucity of information disclosed in the press release, I am not going to do more than speculate and hope for the most favorable answer.
OK use the $1.25 for the retained asset distribution, and use another $.49 for the acquired TRGP shares ( current distribution / .1809 ). So to break even versus the current distribution I need to make $.21 on the $9 cash. That is 2.3%. If I can make 5% or $.45, then I am at $2.19 versus the current $1.96 or about a 12% pop. I would like to know the tax consequences of the return of cash, of course. But I am getting TRGP high growth distribution rate too.
Pretty glad I swung for another 2000 shares at the bargain basement prices of Friday!
Funny that a guy who wants to point to the 10 K cant seem to read what the 10 K says. Here is a direct quote:
The Trust has been informed that the Cliffs’ supply agreements with ArcelorMittal that involve iron ore products shipped from Northshore do not use a world market-based iron ore pricing mechanism.
Key words: DO NOT USE A WORLD MARKET BASED IRON ORE PRICING MECHANISM
Thanks for playing though.
LOL. One has to admire the willingness to wallow in your misery. Look down the thread. All those lonely posts as you comment to yourself. Find a hobby?
Well maybe we did not get a pop. Yahoo is showing a 17 cent rise at the close, but my WFA account has no such rise in the price. Anyone else have this anomaly.
Well we got a small pop in an otherwise downmarket. I will take it for now. Make take awhile for the public to figure out what we know due to shipping reports I guess.