If you google Master limited parnerships: it's time to get pick + Barron's, you should be able to read the article, going to Barrons want get you there unless you are a subscriber. I googled it and got it. Harold
jerry, there is an article on MLPs in Barron's today, excellent, the Morgan Stanley guy, who may be one of the best says TRGP still has room to run and mentioned OKE as a good buy for div growth. I think OKE will be merged with someone eventually so could be good long term hold. Both of those are C corps so no k1 issues.
jerry, WMB is by far my largest holding, need to trim some but still think it hits $50 next year. Saw the note on the activist up to 10% and hiring an adviser, not sure what they could do, probably a couple that would jack up the price a few dollars or a merger, but don't see who could do it, have always thought they would be a good fit with EPD. KMI is huge. PSX could do it, they want to grow midstream and that would do it, actually PSX would be a good fit. I'm going to hold on, $2.10 div next year, $50+ at 4%. As for TRGP I missed that one in the $30s a couple of years ago, notice an analyst down grade today, I think the run is probably over, wouldn't buy them now. I know nothing about OGS, OKE is probably a good buy, also could end up with another co. DNR is an enigma to me, under valued, 8% growth, levered to oil, not severe downside, but there are better yield plays and better oily growth stories, PXD will do close to 20%. EXXI falls in the same category, both upside to 100% with $100 oil but no much growth. Hang on to WMB for a while, I would bet something comes out of their push, maybe a big deal, maybe a small one that move stock up a few dollars.
Another multiple personality poster on a board, as least it's only two so far. Have a feeling that with the release, he make or lose his few pennies and move on, his delusions intact. Could at least change the syntax on the posts.
Hugh, nice to see you post. Seems the world's supply outside of SA is coming from No Dakota, the Rockies, Texas.... You have the scenario where the shales are profitable at $50 and it takes $90 everywhere else, except for SA where you can turn the spigot higher. That seems a great investing op if that equation remains the same, the e and p cos here will continue to add value. I'm not sure why the majors have not been move proactive in buying cos, XOM did try but bought gas at higher prices. Cos like PXD, EOG, NBL, APC, APA, DVN and even RRC should be targets for the majors. Those cos have well inventories that last for decades in some cases. Couple all of this with SA goal of $100 oil, means high returns for the US shale cos for long time to come. All of those independents are now supplying the globes marginal demand increase, that's not a bad business. Probably can't count on price increases, maybe gas which should be good for RRC. The returns will come from increasing prod, PXD said yesterday they can grow up to 20% a year for the next few years. The advantage is that it is unlikely that the rest of the world can duplicate the shale success, the geology is there but the markets/infrastructure isn't. We prod 8mm bs /d and use 14mm/d, We can back out a lot of foreign oil over the next decade. And the infrastructure cos probably are better bets than the producers. Interesting times, and they don't appear to be over yet. Maybe the peak oil theory couldn't foresee the shale revolution. Or it could just be a US phenom. Hope things are going well for you.
Sensitivity I saw, one of the best profiles, -7% for $70 oil and +100% for $100 oil. That's to the current stock price, so obviously the market doesn't think we will have long term $100 oil. The pres Don mentioned would probably give you margin per barrel, would guess breakeven's in the $50 range. Seems DNR is primarily a bet on oil prices vs a vol growth story. OIl goes to $100 long term vs $78 in 18, you have a $30+ stock plus good dividends. It was by far the best profile based on oil price change. Otherwise if the current value is assumed, you get a 8%+ return from more production. EXXI screened well down 20% to up 120%.
The IEA data covers the shale increases, not sure they specify majors vs indies. Essentially the majors are not causing the increases, it's the PXDs, EOGs, NBLs of the sector. Although the majors have a good presence in the Permian, hbp assets, OXY is no 1, APA is 2, think XOM is 3, I believe.
me2, I am down to minimum position here also, this could go either way. Caution on SD, most of the analysts have a NAV less than current $6 price, debt is really under control now, unlike MPO, and I sense that the thing propping SD up is Cooperman and the activists. If Cooperman takes his pos down, it will be $5 quickly. Still think MPO is the best debt recovery co. SD needs some catalyst beyond the Miss, don't see it materializing for a while, other zones. Although they could report better Miss results than last qtr, that could do it, but a #$%$ shoot on that one.
Agree that the First Reserve presence is good for the co, but remember they brought them public with the LA asset, retrospect, was premature. So they do make mistakes, just like all of us. If you want to get a feel for the Anadarko, go to APA's pres and look at the potential they see there, right up there with the Permian. If APA could jettison foreign assets and focus on the 3 million acres they have in those two basins, they would be top tier. Good read through for MPO, we need more info.
Also, investors seem to be ignoring that WTI is pushing $101 and the futures strip has a $78 price in '18. The globe is adding 1.3 mm/d in demand and the US will increase a million /d. Still think the sector will begin to move values closer to today's prices and away from the futures strip prices, but could be wrong.
But you have a couple hundred million in interest, pred stock divs. Just rough but that's $$700 mm, and if you make $600mm, you are still adding to debt, would think the revolver would take care of it, but you can't continue to come out on the low side of expectations. The market will be unforgiving, although at $300mm in equity, there's not much more to penalize. I think $4 ish range, not much downside, unless bk becomes a possibility and that doesn't seem likely at the moment, they could cut capex to $400mm and vols would be up to 32kboe'd vs 35kboe/d, that's not very scientific but shows the challenge. At 32, that's not much growth but not a bk candidate. We just don't have enough info, speculation without more data, unless someone on the board has clear view.
Meanwhile, PDCE is up 5% today, still think it is a better double poss without the risk.
One other data point, Don mentioned PV10 for DNR, PDCE's PV10 is $2.7 billion vs an enterprise value of $2.2 billion, selling for less than PV10 with years of well inventory. Just seems a great value. I oil goes to $70, not so much, but CS sees 20% downside to $70 and 100% upside if $100 oil was factored in, most of the e and ps are assuming a drop in oil and it's not happening so far. Could get a reset to higher assumed oil prices, or not. But even EXXI looks like a great bet if $100 oil is assumed, probably 100% upside, issue with them is they don't have much growth right now. DNR is a good bet on oil appreciation.
Birdog, look at the NPV's per well $4mm plus, about 70% liquids, confirmed by APC and NBL. APC actually sees $5mm NPV per well. PDCE say 2800 wells x $4mm, $11 billion NPV value to be captured in the Wattenberg, they show 75% IRR middle case, APC and NBL, about the same, NBL sees 180% IRRs on extended reach laterals. On the Utica, not much in the stock for success there, those wells could be the best returns in the industry, up there with the super rich Marcellus, huge wells 1500 boe/d IPs and up. PDCE is around $2.2 billion EV, debt is reasonable. I still like MPO, but is has become more of a speculation, it could double, but I'm betting PDCE doubles and with a lot less risk. Look at the APC and NBL pres on the Wattenberg, they both lead with that play, and they have some world class assets, PDCE is the third largest holder. I have bought a lot, would probably wait for a pullback for more, but they report on 2./20 and could move the stock up, or not, I don't have much success trying to guess those movements, but if oil stay around $100 and with gas coming back, PDCE looks like a good bet. Also own BCEI for their Niobrara as well.
Easy answer, no, capex of around $500mm and interest, ebitda won't cover it this year or next, maybe '16.
Birdog, i looked at it yesterday, haven't paid any attention to it for a while. They cut the dist from $2.13 to 40 cents, dist cash is $400 mm this year, dist is $100 mm, so they have cash. They want to pay down debt and get ready for an investment in Bluegrass with WMB I would think, that project is still tentative, but BWP needs it. WMB will do well with it and well without it. But BWP has a pipeline to no where now, with all of the gas being produced in the NE. Those pipes should be used to bring liquids south. WMB thinks it will get done and BWP will need to invest in it. The Tisch family through Lowe's controls BWP and they are going to do the best thing for the Tisch's no matter the holders of BWP. The peril of owning an MLP without the GP, you can get screwed. EPB is suffering now, not to that extent but the new gas flows are rearranging the pipes. So, no it really probably helped WMB, BWP can do the project, and I read into it that maybe it will get done. BWP has $650mm of ebitda, and EV of round $7 billion so it's fairly cheap now, but I wouldn't buy it. Probably gets back to a decent dist in a few years, bu others look better.
You should look at PDCE again, they have a boat load of reserves in the Wattenberg, 80% oil, 850mm bs of 3 p reserves. May be one of the cheapest e and ps in the market. CS just put out a report that said NAV goes from the current $82, stock price is around $50 to $190 if they value all of the potential. It's not the same co that you remember. And that really doesn't take into account the Utica, little value there in the stock and that could be a big deal as well, they have 50K acres. PDCE is the third largest holder in the Wattenberg behind Andarko and Noble.
I don't mind looking clueless as long as I make money. But the longer your time frame, the easier it gets. At the moment, feels like the whole sector could go up or down, but up feels the easier route is up, and more upside than down. Looked at a sensitivity, if the group was valued at $100 oil vs the current strip, a group of ten cos up 40 to over 100%, their valuations compared to current stock prices. A belief in $100 oil would move everything up. We're not there yet. On $70 oil to $100 oil, PDCE and BCEI stood out, up over 100% and 80% for PDCE/BCEI and down less than 20% for both. This could be a good year.
For MPO, it's a plan to corral the debt that drives the value but $100 oil and $5 gas would help their cause as well, a few more dollars for capex. Plus looks like NGLs are in much better shape with this weather, propane is in demand.
cbd, BCEI up almost 5%, the H Weil $70 target helped, but I still remember Weil had MPO at $20 or whatever it was. But today it's helping, and PDCE up almost 4%, wait until CS puts out a new target of $100 plus, should move the stock a bunch and I would bet, puls BCEI up with it. BCEI should get a bump with reserves. Those guesses seem easy compared to what to expect from MPO. But at $4.30+, not sure there's much downside, but I think I said that at $4.50 on the last plunge. The other two cos look like T note investments compared to MPO.
I sold out of my HK at $3.50, noticed the move. I like the co, the CEO Wilson, but it's a basket case balance sheet like MPO. I do like their geologies. And their Miss and LA assets are way down on the list for activity. That tells you something about MPO, it's not a super geology play but a decent one with a balance sheet recovery. A delevering event of the kind Crum alluded to would make us all smile. And Andarko successes. I'm thinking about reloading more at current levels. Doesn't take much to move the price.
Traders, is $4.37 a good buy now. Seems it doesn't take much to push it down, noticed a 15k sh trade knocked it down. Seems if we get anything at all pos, this will move up a bunch.
Seems you have to consider both sides of this story. Someone said and it got my attention in the past few months, that the profit might in trading this stock, and that has been the case. I'm a lousy trader but have been lucky so far. I would bet against Metoo that a bump up is on the way, a relief move from the info vacuum. This is still a co that could produce 36kboe/d this year, just looked at LPI's release and they are at around 25kboe/d now and a $3 billion market cap co, MPO is $300 mm. If they can show a plan for a couple of years, the stock will move up quickly. Not a trader but appreciate the negative comments. First rule, don't lose money, second, don't forget the first.
I do suspect that BCEI will get a boost with reserves, seems it could be over $50 fairly quickly. Makes you forget about MPO for a while.