Cowen cuts Potash, Mosaic, Intrepid Potash, CF Industries
Apr 14 2016, 11:16 ET | About: Potash Corporation of Saska... (POT) | By: Carl Surran, SA News Editor Contact this editor with comments or a news tip
Potash (POT -2.4%), Mosaic (MOS -3.5%), Intrepid Potash (IPI -8.2%) and CF Industries (CF -1.3%) are downgraded to Underperform from Market Perform at Cowen, which cites the risk of a further deterioration in the grain environment and the belief that nutrient prices and margins still have room to fall.Cowen expects an increase in U.S. corn acreage to 93.6M acres from 88M acres, plus anticipated gains in Brazilian and Argentine output, to cause a sizeable drop in corn prices and 2017 corn acreage, which would weigh on ag company shares.The firm cuts its price targets for POT to $14 from $16, MOS to $23 from $32, and CF to $25 from $44; Agrium (AGU -3.7%) and CVR Partners (UAN -3.2%) are maintained with Market Perform ratings but with reduced price targets of $86 and $8, respectively.
CVR Partners to Announce 2016 First Quarter Results And Cash Distribution on April 28
Executive Conference Call to be Held at 11 a.m. Eastern on April 28
PR Newswire CVR Partners, LP
30 minutes ago
SUGAR LAND, Texas, April 14, 2016 /PRNewswire/ -- CVR Partners, LP (UAN), a manufacturer of ammonia and urea ammonium nitrate (UAN) solution fertilizer products, today announced that it will release its 2016 first quarter results and announce its cash distribution on Thursday, April 28, before the open of New York Stock Exchange trading. Chief Executive Officer Mark Pytosh and other executives will host a teleconference call for analysts and investors on April 28 at 11 a.m. Eastern.
The combination of CVR Partners' Coffeyville, Kansas, fertilizer plant and the East Dubuque facility provides the partnership with an expanded geographical footprint, diversification of its raw material feedstocks, wider customer reach and greater potential for cash-flow generation.
"The addition of East Dubuque to CVR Partners positions us as an emerging leader in the North American nitrogen fertilizer industry and makes us more competitive in a changing market environment," said Mark Pytosh, chief executive officer. "CVR Partners is now better equipped to weather cyclical downturns, excel in dynamic market conditions and act on growth opportunities. We expect the enhanced strategic platform of the combined business will create value for our unitholders, customers and employees.
"We welcome East Dubuque's experienced management team and talented workforce to CVR Partners," Pytosh said.
In 2015, the Coffeyville plant produced 385,400 tons of ammonia and 928,600 tons of UAN, and the East Dubuque plant produced 340,300 tons of ammonia and 279,000 tons of UAN.
*DJ News On Rentech Nitrogen Partners L.P. (RNF) Now Under UAN
Mar 31, 2016 17:08:00 (ET)
(END) Dow Jones Newswires
March 31, 2016 17:08 ET (21:08 GMT)
ICAHN CARL C purchased a total of 307,777 shares on March 21, 2016. Over the last 4 years insiders have on average purchased 438 shares each year.
Insider Transaction History
Date Name-Position Transaction Shares Price Range ($) Shares Held Mkt Value
3/21/16 Icahn Carl C
Beneficial Owner of more ... Purchase 307,777 10.04 – 10.64 307,777 $3.2 M
ECTON DONNA R purchased a total of 2,000 shares on March 10, 2016. Over the last 5 years insiders have on average purchased 63,675 shares each year.
Insider Transaction History
Date Name-Position Transaction Shares Price Range ($) Shares Held Mkt Value
3/10/16 Ecton Donna R
Director Purchase 2,000 7.20 – 7.20 28,469 $14.4 K
12/25/15 Pytosh Mark A
Chief Executive Officer Exercise of Options 22,199 0.000 – 0.000 55,932 $0.0
White William L
Officer Exercise of Options 18,136 0.000 – 0.000 4,378 $0.0
LOS ANGELES--(BUSINESS WIRE)--
Rentech Nitrogen Partners, L.P. (RNF) announced today that its Board of Directors has declared a cash distribution of $0.11 per common unit to distribute the initial proceeds from the recent sale of its Pasadena, Texas facility. The distribution is payable on March 31, 2016 to holders of record as of March 28, 2016. The distribution represents initial sale proceeds of $5 million net of transaction-related fees of approximately $0.6 million.
The Partnership also set a second record date that coincides with the closing of the pending merger of Rentech Nitrogen and CVR Partners, LP for rights to receive all additional cash distributions payable to Rentech Nitrogen unitholders related to the Pasadena sale. This means each Rentech Nitrogen unitholder as of closing of the pending merger with CVR Partners will receive: (i) the merger consideration of 1.04 common units of CVR Partners and $2.57 of cash per common unit of Rentech Nitrogen; (ii) the right to receive their share of a cash working capital adjustment from the Pasadena sale, which is estimated to be approximately $6 million and which amount is expected to be confirmed within ninety days of the Pasadena closing; and (iii) the right to receive their share of any potential milestone payments from the Pasadena sale, which will be calculated as 50% of the Pasadena Facility’s cumulative Adjusted EBITDA, as defined in the Pasadena sale agreement, in excess of $8 million earned over the next two years. The payment dates for the working capital distribution and the potential milestone payment distributions will be set promptly after such funds are received.
9:15 am Penn Virginia (PVAH) reaches credit amendment with reserve-based lenders; agreed to push back date for certain events of default until April 12 (possible further extension to May 10) (:PVA) : Additionally, an ad hoc committee of the senior unsecured noteholders, which represents more than 50% in amount of the senior unsecured notes, supports the Credit Amendment. Penn Virginia intends to use the additional time to continue discussions with various of its creditors, including the RBL Lenders, the Noteholder Committee, and certain of its major contractual counterparties, with the objective of reaching agreement on a comprehensive debt restructuring.
6:40 am Rentech Nitrogen Partners misses Q4 estimates; UAN merger may close at the end of March (RNF) :
Q4 adj. EPS $0.20 vs $0.42 Capital IQ Consensus; revs -4% to $77.4 mln vs $99.00 mln Capital IQ Consensus Estimate
While the fourth quarter was affected by weather and the inability to ship all of our prepaid UAN commitments, we expect to largely make-up for the lost sales volumes in the first quarter of 2016." Mr. Forman continued, "We believe expectations for increased corn plantings this spring, along with the early start to ammonia application that we are seeing in parts of our trade zone, will drive strong nitrogen demand through the second quarter."
Overall, CVR Partners reported fairly good numbers. The return of the distribution and improved operational performance are major positives. At current prices, CVR Partners has a forward yield of over 17.5%, an insane level given that the distribution could actually be heading even higher in 2016. As for its valuation, CVR Partners is also extremely cheap trading at just 5x EV/EBITDA and ~5.5x TTM DCF, while net debt is extremely low at just ~$75 million versus ~$110 million in annual EBITDA.
CVR Partners: Extremely Cheap With Low Net Debt
Feb. 19, 2016 11:43 AM ET|5 comments | About: CVR Partners, LP (UAN)
Albert Alfonso Albert Alfonso⊕Follow(5,383 followers)
Dividend investing, dividend growth investing, master limited partnerships, oil & gas
CVR Partners restarts the distribution.
After suffering from unplanned plant outages in Q3, the company sees improved performance for Q4.
The forward distribution yield is above 17%.
CVR Partners (NYSE:UAN) had a disastrous run during the second half of 2015. The company faced several major challenges related to operational issues at its Coffeyville plant and weaker than expected prices for its production. These events culminated during Q3 2015 which saw the company not pay a quarterly distribution for the first time in its history. Though, CVR Partners seems to have recovered somewhat during Q4 2015.
The return of the distribution
The first and most important thing about CVR Partners' results was the return of the distribution. The company declared a $0.27 per share quarterly distribution for Q4 2015 (payable in Q1 2016). This comes after no distribution for Q3 2015, as noted above.
Keep in mind that CVR Partners is a variable rate MLP and its distribution can and do vary greatly quarter to quarter. Since its IPO, the average quarterly distribution has been ~$0.42 per unit, but the range has been anywhere from zero to $0.61. This feast or famine situation is not ideal, but the nature of the business makes it necessary.
Operational results improve
As to why CVR Partners is able to pay a quarterly distribution, you'll have to look at its operations. Q3 2015 was plagued with several planned and unplanned plant outages. This was not the case during Q4 2015.
CVR Partners produced 116,100 tons of ammonia and 270,500 tons of UAN in Q4, up 75% and 77% versus 66,300 tons of ammonia and 152,400 tons of UAN last quarter and up 10% and 4% versus 105,900 tons of ammonia and 259,600 tons of UAN last year.
As a result of the increased production, adjusted EBITDA improved to $28.5 million, up considerably compared to just $3.8 million in Q3, but down 15% from the $33.5 million last year due to weaker prices.
Ammonia and urea ammonium nitrate prices have stabilized, but are below prior levels
As noted above, CVR Partners saw weaker prices for its UAN and ammonia production during Q4 2015. Prices at the gate for UAN were down 11% to $221 per ton while ammonia was down 13% to $479 per ton compared to last year. Compared to last quarter, prices were down $1 per ton for ammonia and down $6 per ton for UAN.
As for the outlook for prices so far in Q1 2016, UAN fell to as low as $200 per ton along the Gulf Coast before recovering to $230-$250 per ton, while ammonia was running from $450-$500 per ton in the Corn belt. This indicates that the Q1 2016 numbers are shaping up to be slightly to moderately better than the Q4 numbers.
As for CVR Partners' proposed merger with Rentech Nitrogen Partners (NYSE:RNF), the later recently had its unitholders vote to approve the combination. This likely means that the deal will be getting done. The merger would nearly double the size of CVR Partners. Though, there is still the issue of the Pasadena facility owned by Rentech which is not part of the merger and instead will be spun out.
I have mixed feelings about adding Rentech as that company has much more debt and is less profitable compared to CVR Partners. Though, adding a second facility to the fold would reduce volatile from plant outages and help avoid a repeat of the Q3 disaster.