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Inergy, L.P. Message Board

gmax97 26 posts  |  Last Activity: Feb 18, 2016 5:08 PM Member since: Nov 13, 1998
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  • WFA recently did a sum of the parts valuation on a number of MLPs. Their valuation on what are the various business pieces of NGL worth came out at $22. This is not a dividend/distribution and growth valuation but more like a break up value. At $6.50 that is 70.5% discount to that valuation. And the distribution has been reiterated so you will get back 40% of that within the year. Nothing is without risk in this volatile market but the sheer magnitude of the upside here surely must entice your to want to ride at least a small position. Shorts have to pay that distribution so its hard to believe it going much lower. Your mileage may vary, but that is the way I see it.

  • Reply to

    WFA Sum of the Parts Valuation

    by gmax97 Feb 10, 2016 1:28 PM
    gmax97 gmax97 Feb 10, 2016 2:05 PM Flag

    What about the one due in 5 days time?

  • Any posting claiming a distribution cut is imminent is blowing smoke. Go the Investor Relations tab on the NGL website. Board has already declared the distribution amounts and dates through August.

  • gmax97 gmax97 Feb 11, 2016 12:57 PM Flag

    Whoops my mistake. Never post before the first cup of coffee. I went back and clearly I was reading 2015 as 2016. Sorry for the mistake.

  • Reply to

    $45 Million Buy Back

    by myownworstenemy15 Feb 11, 2016 2:15 PM
    gmax97 gmax97 Feb 11, 2016 2:52 PM Flag

    How do you know they have not already bought? Would not be disclosed until 45 days after end of the quarter, which is also year end.

  • Check my math. Yahoo which aint the most reliable or up to date source, says 106 Million shares outstanding. Price hovering as I type at about $5.75 per share. So Mr. Market is valuing a company with brand new guiandance a day old, of $450 MM EBITDA at slightly more than 1 time? Insane. I hope it does drop to $4 that be less than 1 times EBITDA. ( something like .94 times ). Looney tunes insane.

    If the approved stock buy back has been partially or fully executed already, the shares outstanding would be even less. If it gets executed in the next couple months, it will be less.

    No one thinks this company is headed for BK and oil is not going to zero, the Russians and the Venezuelans, Nigerians and Persians are already screaming for a production cut. It will happen sooner or later, and most analysts say the markets come back into balance on rising demand starting in July or August.

  • I was too lazy to go look it up at Edgar, but if that is correct then officers and directors have lots of skin in the game. Any posts claiming they are going to give away assets worth $22/Share according to WFA, at $2.50 does not really pass the smell test does it? Why would they do that given their very substantial ownership? Plus why would we vote to approve it, even if such a proposal would be put to a shareholder vote?

  • Reply to

    1.35 X EBITBA ?

    by gmax97 Feb 11, 2016 3:13 PM
    gmax97 gmax97 Feb 11, 2016 6:06 PM Flag

    I am not talking about the distribution. Hell cancel the whole distribution. I said EBITDA. One times ( rounding down ) EBITBA is a silly valuation. The EBITDA was just reset in the guidance ONE DAY AGO. The market is quite irrational, and that is why you need to avoid the herd, and if your research says the valuation is anywhere near that low of a valuation, the company is making earnings, debt leverage is reasonable and cash is not a problem such that liquidity could cause a BK even if the company is not broke ( liabilities exceed assets ) then maybe when oil demand and supply approach parity which lots of global markets analysts say is July or August, you will be laughing instead of crying in your beer. Your mileage of course could vary.

  • Reply to

    Yahoo lists insiders at 20% ownership

    by gmax97 Feb 11, 2016 3:20 PM
    gmax97 gmax97 Feb 11, 2016 6:12 PM Flag

    Is it 20%? So over 20 million shares at even $6 is still $120 MM + at risk. That aint chicken feed. Most but not all MLP structures have a GP and most of those have Incentive Distribution Rights, to incentize the GP to grow the distribution as the IDRs grow as the distribution does, at least to a point. as IDRs are capped at some level in every GP MLP that I am aware.

  • Reply to

    1.35 X EBITBA ?

    by gmax97 Feb 11, 2016 3:13 PM
    gmax97 gmax97 Feb 11, 2016 6:30 PM Flag

    The sale paid down some debt, and the company said in its press release that they would no longer consolidate the Transmontaigne LP that they still hold stock in, so that is a big chunk of debt that disappears also. I did not look up the numbers, but someone here may know, there are plenty of very knowledgeable of this company and its balance sheet.

  • Reply to

    Yahoo lists insiders at 20% ownership

    by gmax97 Feb 11, 2016 3:20 PM
    gmax97 gmax97 Feb 11, 2016 6:36 PM Flag

    I must not understand. They hold paper that is worth $120 MM + but they are going to dilute that? Why would they act against human nature to maximize their return? And why would they not try to get $22 X 20 MM = $440 MM which is the WFA valuation sometime in January on a sum of the parts basis.

    5.70 going to $22 is almost 400% ups. Forget totally about a distribution, all though the company has reinterated their intention to continue it, That is gravy on top of the large pile of mashed potatoes.

  • Reply to

    Can someone explain to me...

    by tradedollarnut Feb 11, 2016 6:55 PM
    gmax97 gmax97 Feb 11, 2016 7:01 PM Flag

    They have granted the buyer of Transmontaigne an option to purchase something like 800K of those shares, so until that option expires they probably can not sell that portion of their holdings. My guess is that they do sell but are hoping for an updraft so that the price they can acheive is something other than Filene Basement pricing ( if you have ever been to Filene's Basement you know what I mean...

  • Reply to

    1.35 X EBITBA ?

    by gmax97 Feb 11, 2016 3:13 PM
    gmax97 gmax97 Feb 11, 2016 7:56 PM Flag

    The thing about a leverage valuation is that in a rising environment, you do way better than an unleveraged one, since debt does not participate in the upside one dollar. Every dollar of upside goes to equity. So 7.6 times when maybe something like 12.5 ( the inverse would bea capitalization rate of 8% so a return of 8% ) is more the expected is also a very very low valuation.

  • Reply to

    Can someone explain to me...

    by tradedollarnut Feb 11, 2016 6:55 PM
    gmax97 gmax97 Feb 11, 2016 8:00 PM Flag

    How do you know they are not dribbling it out currently. If you dump 2.4 MM shares of a lightly traded stock you will not get even close to current market price. And while it may seem to be a no brainer to you to sell and redeploy immediately. it is also human nature to not sell anything way below what you believe its true value to be. Look at the slow down in house sales in markets that see declines.

  • Reply to

    1.35 X EBITBA ?

    by gmax97 Feb 11, 2016 3:13 PM
    gmax97 gmax97 Feb 11, 2016 8:20 PM Flag

    Lets do that math again. 12 X $450 MM = $5.4 B
    Remove debt of $2.5B ( $3.1 B - 600 MM )

    Leaves $2.9 B / 106 MM shares or $27.35 per share.

  • gmax97 gmax97 Feb 16, 2016 10:13 AM Flag

    Wells Fargo posted mine to my account early this AM. Given the overnight earnings in savings accts is literally less than a ham sandwich, I am not going to make a big deal out of it.

  • Almost 17% Ups already with a little less than 2 hours to go. So after paying a 10% quarterly distribution and then add in Friday's run up and today, some shorts are surely feeling the pain. A pity really

  • Reply to

    Shorty running over folks trying to exit?

    by gmax97 Feb 16, 2016 2:19 PM
    gmax97 gmax97 Feb 16, 2016 6:11 PM Flag

    So $7.71 plus .64 distribution paid puts them at $8.31 at end of the day. if they shorted at exactly $10, they are only up 20% with one more big day up and they are toast. And it has not been above $10 since Feb 5th. Of course some shorty was calling for $2.50. WHOOPS

  • Reply to

    Shorty running over folks trying to exit?

    by gmax97 Feb 16, 2016 2:19 PM
    gmax97 gmax97 Feb 17, 2016 10:13 AM Flag

    Now $8.99! Shorty can get out of his own way, full blown panic drop your weapon, every man for himself. RETREAT! RETREAT!

    LOL I am laughing at the fools.

  • Reply to

    Shorty running over folks trying to exit?

    by gmax97 Feb 16, 2016 2:19 PM
    gmax97 gmax97 Feb 17, 2016 12:55 PM Flag

    Did you just say up? Another 14.5% up at the moment and its been even higher at days high. That is flat or maybe down. Better close that short position out, going higher as its worth more as I have demonstrated in other posts and you are working on paying another distribution!