I agree, but a 40 cent dividend was obviously well thought out before they made the announcement. A high debt load with restrictive covenants coupled with a fear of continued lower renewal rates drove them to set this dividend level. Per the call, they signaled a long term [2 to 3 years] impairment of the business, especially with Loews possibly having to come in with $300 mm to protect their position within BWP. This $300 mm will come with a high price tag should it be needed. If there is a long term problem I feel an $8 to $10 price tag is realistic.
A 40 cent dividend at $20 would be a 2.00% yield. Not acceptable for an MLP. I think the conference call left the door open for continued lower renewal rates in the future . . . putting further pressure on future cash flows.
I don't think we have seen the end of the bad news. Expect further asset write offs later this year plus lower renewal rates for several years to come. Would not be surprised if stock price falls below $10.