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PCC Message Board

gnrlowners 15 posts  |  Last Activity: Nov 19, 2015 10:08 AM Member since: Apr 1, 2005
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  • Reply to

    Someone thinks they know something

    by gnrlowners Nov 13, 2015 9:46 AM
    gnrlowners gnrlowners Nov 19, 2015 10:08 AM Flag

    Turns out, they were right they knew something alright.

  • Reply to

    New credit facility at low rate

    by gnrlowners Nov 12, 2015 10:11 AM
    gnrlowners gnrlowners Nov 13, 2015 12:11 PM Flag

    Yes but even at that time, Wall Street was skittish about investing. There were some table pounding bulls like Warren, but many on Wall Street were saying "It will get much worse before it gets better". But here we have a complete divergence of opinion.

  • The stock is off a cliff on no news.

  • gnrlowners gnrlowners Nov 12, 2015 3:40 PM Flag

    Jeffry, there is an excellent analysis of SXCP's situation on Seeking Alpha. I tried to post it but Yahoo won't allow it. So search for Suncoke LP and Seeking Alpha and you'll find it. The author discusses the possibility of bankruptcies in the steel industry (for SXCP's customers, it's unlikely). The biggest thing he raises is about the MLP situation, but I believe that will not be an issue for 10 years at the worst.

    As far as yield. Consider that SXCP's yield is double that of 5 year Puerto Rico bonds, and you *know* they are going to take a huge haircut. Certainly I've never even heard of a stock getting beaten down like this while they are *raising* dividends. The market is flat out saying the dividend is going to be cut by 50% or more. Yet analysts estimates are rising for next year. It's fear of how bad things could get, versus how bad they actually are that has the market spooked.

    Frankly I think there is a fair chance that Tesla will be in bankruptcy within 5 years, but the market cannot get enough of that money losing stock.

    Sentiment: Strong Buy

  • The new credit facility that SXCP just got is essentially at Prime for 4 years. Bank of America has little fear that they can pay that loan back, or the rate would have been much higher. Again, Wall Street professionals think that SXCP is fine, but the general public is terrified. Fascinating.

  • Here is the crazy, crazy thing. Over the last month or so, the analysts covering SXCP have *increased" their earnings estimates. Yet the stock continues to collapse. I've never seen anything like this where Wall Street and the company say one thing, but investors are saying 100% the opposite.

    I think we'll have more clarity next month when SXCP provides their outlook and guidance for next year.

  • Reply to

    Earnings per share

    by asstsecretary Oct 24, 2015 11:04 AM
    gnrlowners gnrlowners Oct 29, 2015 1:08 PM Flag

    Net income per unit was 43 cents per share. But you have to look at all the factors to really get a handle on what that number means.

  • Reply to

    Why the big drop today ?

    by josipemo Oct 23, 2015 12:02 PM
    gnrlowners gnrlowners Oct 23, 2015 1:11 PM Flag

    The stock is now partly tracking oil and gas prices. But 10% down today? My guess is either a downgrade that hasn't hit the newswires, or a fund doing some major liquidation.

  • Reply to

    Counterparty Risk

    by mrdudley10 Oct 19, 2015 11:27 AM
    gnrlowners gnrlowners Oct 19, 2015 11:53 AM Flag

    *That* is the risk, bankruptcies in the steel industry. If that happens, then SXCP should be priced where it is. But barring that, the stock price makes no sense. Their dividend is not at risk, they've raised it every quarter this year and will raise it again next quarter. In mid December they will give their projection for 2016. That will be key.

  • What of the most interesting conference calls I can remember. SXCP is committed to increasing the dividend one more time this year, to 60.5 per share. But they are going to stop at that point. Why? Because clearly the increasing the dividend is having no affect on the stock price. So instead they are going to use their cash flow to buy back shares, pay down debt and potentially look for other acquisitions. Expect that the dividend will be 2.42 per share for all of next year. I know, it will be hard to get by on that paltry 17.9% yield, but we'll manage somehow. There is just no sign that SXCP is in any kind of trouble. They have significant extra cash flow now with the integration of Convent Marine. It's going to take a few quarters. But as the market sees stock buy backs, and reduced debt, their terror that SXCP is going out of business will abate. There is no reason it cannot be a $20 stock next year.

    Sentiment: Strong Buy

  • Reply to

    Fasten Your Seatbelts

    by mrdudley10 Oct 6, 2015 8:49 PM
    gnrlowners gnrlowners Oct 11, 2015 11:04 PM Flag

    You know the old saying, where there is smoke, there is a wet blanket on some smoldering coals. The market very often is just plain wrong. Look at analysts estimates for SXCP for next year. Compare that to the earnings estimates for coal or steel producers. It's telling you a really different story.

  • gnrlowners by gnrlowners Oct 11, 2015 11:00 PM Flag

    What I'm really curious about is why they pushed the earnings report up so soon. They will be one of the first companies reporting earnings for the 3rd quarter Last year they didn't report until the end of October. I think this will be either really good, or really bad news tomorrow. I'd guess really good, otherwise why not push it out a few more weeks?

  • gnrlowners by gnrlowners Oct 8, 2015 9:27 AM Flag

    I can't find a symbol for this preferred, but the call isn't until November 2nd. Does anyone have a good symbol? My broker couldn't find it.

  • Reply to

    Crazy stock

    by gnrlowners Oct 1, 2015 1:29 AM
    gnrlowners gnrlowners Oct 1, 2015 11:23 PM Flag

    Do you think the dividends from SunCoke are going to stop? Not a chance. They are making money, and as an LP they have to pay out those profits. In fire years? There will still be 7 to 10 years left on their take or pay contracts.

  • gnrlowners by gnrlowners Oct 1, 2015 1:29 AM Flag

    I've never seen anything like this. 21% dividend? Normally that's the last dividend before they stop them altogether. But there just isn't any sign of that. SunCoke LP is one of the most misunderstood stocks out there. People think they are a coal miner and are going the way of Arch. But SunCoke LP doesn't own any coal, they just process it. With their 'take or pay' contracts they have guaranteed revenue for the next 12 years or so.

    The risk? The risk would be bankruptcies in the steel industry. Then they could break the contracts and SunCoke LP would be in trouble. But so far that isn't happening. Though the steel industry isn't great, they are not on the edge of bankruptcy, and earnings are expected to rise for steelmakers next year. With some new tariff protections probably kicking in in the next few months, steelmakers should have an ok 2016. And an ok 2016 is more of our 21% dividend. Just crazy.