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Inergy, L.P. Message Board

marklibera 220 posts  |  Last Activity: 8 hours ago Member since: Aug 14, 2007
  • Reply to

    Look for for CHKR

    by centurycom Jun 9, 2014 4:27 PM
    marklibera marklibera Jun 11, 2014 1:58 PM Flag

    grgsvll, as we have discussed, the continuing decline in production is exceeding any benefit gained from higher oil, NGL or gas prices, resulting in lower revenues each quarter. Also, as we have discussed, the Trust appears to have exposure with its oil hedges in that its hedge volumes exceeds the amount it produces. This has the effect that they are "short" oil, such that a rising oil price leads to impairment of the value of their hedges. Despite the higher oil prices, they have not been able to increase drilling to increase production. So despite the fact that the distribution remains at the subordination level, the fair value of the future cashflows leads to a much lower level than it is currently trading at.
    All it will take is one more Seeking Alpha article to explain this (again) and the computer programs that control "investing" or "trading" in stocks will hit "sell" and drive the price down again. Wash, rinse, repeat.
    At some point in the future, the drilling schedule will be reached, the subordination period will end and the distribution will correct lower and the stock price will have to be adjusted to account for a lower distribution.
    In the short term, the stock price can stay elevated. For example, there are a couple of trusts, one is a trust that produces iron ore pellets (GNI) and one is one of the Whiting oil trusts WHX, whose stock prices stayed above their fair value for long periods of time because of the high distributions they were paying, despite the fact that each trust had disclosed that their term was coming to an end and the sum of the remaining istributions would fall well below the then trading price. Then one day, each of these stock prices collapsed IN ONE DAY. GNI fell from 60 to 25. WHX went from $4.5 to under $2. Everyone was warned but because the drop never seemed to come, they kept holding until it happened.

  • Reply to

    market forcast

    by bayman667 Jun 10, 2014 12:02 PM
    marklibera marklibera Jun 11, 2014 10:09 AM Flag

    It's funny that everyone loved WMC when it was flying high, but now people hate it. Gracieblackbelt's comments on the WMC board are instructive. I agree they bungled their spo and their transition to a hybrid mREIT was shaky. It will be interesting to see what their dividend is this quarter. Some are expecting a large cut and some still think they will pay what they paid last quarter. The answer is probably in-between. If it exceeds expectations, the stock could get some dividend chasing into the ex-date. But we probably have to wait until they report their quarter before confidence will be regained in the stock. I'm holding through the dividend announcement.
    As for other mREITS, NYMT has had a nice run and should announce their dividend by the end of the week. I'm looking to take profits then as they are trading at a big premium to book value and an spo is most likely. If they do an spo, I am going to wait a bit before buying, as the price declined a bit after the last offering

  • Reply to

    market forcast

    by bayman667 Jun 10, 2014 12:02 PM
    marklibera marklibera Jun 10, 2014 3:36 PM Flag

    Bayman, you might want to check to see if AWLCF withholds any of their dividend. for foreign taxes. You could get the withheld amount back if you file a foreign tax credit form with your return. Remember this from the days when I owned Canroys.

  • Reply to

    Look for for CHKR

    by centurycom Jun 9, 2014 4:27 PM
    marklibera marklibera Jun 10, 2014 10:06 AM Flag

    The stock has held up well and the absence of a Seeking alpha article is noticeably. Past charts show the decline typically occurs during the third week in the Mar, June, Sept Dec, which aligns with options expirations. Maybe the algos or hedgies are propping it up to let the June puts expire before they take it down.

  • Aubrey's new company announced a large purchase of acres in the Permian and the Marcellus. Looks like the Marcellus properties went for well over $20k per acre. Jefferies was the investment banker on the deal.

    On a separate note, MHR has a slide in their presentation materials that shows the value of each company in the Utica based on their $ of their market cap per acre of Utica The lowest $/acre of Utica properties is EVEP.

  • Reply to

    Just bought my first position

    by bobdbeck Jun 9, 2014 12:28 PM
    marklibera marklibera Jun 9, 2014 4:08 PM Flag

    My posts aren't posting so I'll try one more time. RSI on Apple is over 80. Last time that happened, the stock fell 100 points (pre-split). Some reports that many professional money managers are underinvested going into the quarter end and have been using Apple as a market proxy. That could keep the rally going into month-end. Read about 6 separate articles from Jeff Saut (no bear) Todd Harrison and others. Many of the indices are approaching "round" numbers, i.e. 2000 on the S&P, 1200 on the Russell, 17,000 on the Dow. Good levels to pause.

  • Reply to

    OT: PAA

    by marklibera Jun 6, 2014 2:59 PM
    marklibera marklibera Jun 7, 2014 1:44 PM Flag

    Listening to the PAA/PAGP investor presentation. I don't own either of these, but they have been great performers. From the presentation, this struck me. PAGP which is the gp (and you know how I love GPs) is planning on growing the distribution 25% this year. Equally as important, it is taxable as a C corp, meaning no K-1, and because of their NOLs, there will be no reportable taxable income for 2014, 15 and 16.

  • Reply to

    o/t VALE

    by madmax19471952 Jun 6, 2014 8:58 AM
    marklibera marklibera Jun 7, 2014 11:46 AM Flag

    Stagg, yes and no. I have seen some of the best companies return to all- time highs after several years including missteps, and I have seen some vanish. I could be wrong about commodity companies like VALE but they have had a decade of global growth led by China and other developing countries and cheap credit. They were also building houses in the US and banks were making loans right up until 2008 when the bubble popped. That's how the game is played -- they go 100 miles per hour and then crash in the real estate/ building sector. There are recent items that China has discovered that the metals collateral securing metals-backed loans is missing. The WSJ reports today that some banks are looking to see if some commodity collateral was used more than once to secure additional loans. So there are continuing signs of issues in China. Maybe it doesn't crash, but a slowdown would still be bad unless the growth picks up somewhere else.
    As an example, US drug companies had a tremendous run in the 1990s but then had a long period of being flat before their stocks started up again. So it's about opportunity costs as well. Even non-cyclical companies can have stocks that run in cycles.

  • Reply to

    OT. PSEC and KKR

    by jerseyvinny2 Jun 4, 2014 2:26 PM
    marklibera marklibera Jun 7, 2014 11:21 AM Flag

    Kee, I once owned both ETP and ETE when I first started investing in MLPs. The lesson there was to own the GPs and forget about the yield difference, further supported by experiments owning TRGP and NGLS, owing WPZ but not WMB, and owning WGP versus WES. Target on ETE is $75 but it's K-1 is a mess with 5 different MLPs to report.
    Antero filed an S-1 a few months ago. You can find it under Antero Resources Midstream. They are still in the SEC registration process so there are no numbers yet in the latest amendment, but it should come public in July/Aug. They do have the financial statements however and the growth was huge and includes a water business. In the Marcellus. Antero is or will be one of the biggest producers there. My experience has been to just buy these midstream IPOs. Hopefully it won't be priced too rich.
    I am also going to add more WGP. I read that it will double in 2-3 years.

  • Reply to

    OT: PAA

    by marklibera Jun 6, 2014 2:59 PM
    marklibera marklibera Jun 7, 2014 11:05 AM Flag

    A little early to sound the all clear on PSEC in my opinion. Let's see how rates react next week. Watching the 2.63% level on the 10 year to see whether to hold onto WMC. Dividend announcements in another week or so on that, NYMT NRZ and others which should provide a run but then some SPOs.

  • marklibera by marklibera Jun 6, 2014 2:59 PM Flag

    From the i.v. board, PAA raised guidance 8-10% over the midrange of their previous guidance. Should give a boost to both PAA and its gp, PAGP. With the market up so much, it is hard to recommend new things to buy.

  • Reply to

    o/t VALE

    by madmax19471952 Jun 6, 2014 8:58 AM
    marklibera marklibera Jun 6, 2014 2:34 PM Flag

    Sarge, I agree with Stagg (I know, shocking) that VALE is at a low point and the technicals look to be turning up. Technically it is not oversold with the RSI at 48. I disagree with Stagg about it returning to its prior high of $35. I could see it go to $15 or $16, but I don't see the global economic growth and China is in a bubble. I haven't been following the latest news on iron ore prices, but the past history was distorted by China's epic building, the bubble which seems to be popping.

  • Reply to

    OT. PSEC and KKR

    by jerseyvinny2 Jun 4, 2014 2:26 PM
    marklibera marklibera Jun 6, 2014 8:58 AM Flag

    kee, that's another one that I missed. It is way overbought (RSI 86) as is almost everything. The low yielding/high growing MLPs are absolutely killing it and leaving the higher yielders behind. Last time PSXP got this overbought, it pulled back $5 points to the bottom of its channel, so I would wait if you can.

    I think the overall market could keep rallying until S&P 1975 and maybe to the magical 2000 level. There could be some end of the day selling today because there is no POMO today, but any dip is going to be bought. It is so difficult not to buy when everything seems to be going up, but time and time again, patience is rewarded when things are overbought. On the other hand, if something has not become overbought and is fundamentally sound, one would expect there to be some rotation into those names.

    In the MLP space, I'm looking at HCLP, adding to ETE and waiting on the Antero midstream IPO.

    Good luck.

  • Reply to

    MPW-Mark

    by helmetguru123 Jun 5, 2014 11:24 AM
    marklibera marklibera Jun 5, 2014 2:33 PM Flag

    Guru, I'm not quite the expert on technicals although I mention them frequently and think they are important to view. It looks like TICC bounced off and held support at $9.30 and looks to still be in a longer term upward channel. It has recaptured its 50 and 200 dma and broken out of the mini-downward channel that it had been in since peaking at $10.25ish. All of the support that was broken on the way up is now resistance, but with the market going up, there is no reason that it can't break through those levels. The former high around $10.20 will be key as that area was tested several times and failed.

  • Reply to

    OT. PSEC and KKR

    by jerseyvinny2 Jun 4, 2014 2:26 PM
    marklibera marklibera Jun 5, 2014 12:33 PM Flag

    pale, I don't have enough of CMLP to matter much, but still when you compare it against my MLPs that are outperforming (TRGP, WGP, EPD and MMP) you start to wonder why you are still holding and not consolidating into fewer MLP names.
    With MLPs it is all about distribution growth and those that are growing are getting the share price gains. The higher their shares go, the lower their cost of capital and the more money they can raise to fund projects. I have to remind myself to be patient as some MLPs can take a while before all their acquisitions pay off. But when you look at the charts of the some of the names I mentioned, not to mention the frac sand names that are exploding and some of the LNG boats, you start to wonder if you are missing out on names that can execute better and faster. Recently, I sold some APL because it looked like it was still struggling with some recent acquisitions. With the proceeds I bought MMP at 68. It is now $83. On the other hand, I sold ETE for a good gain a few years back after getting impatient with it (I still have some). I now have a triple on my remaining position and am thinking of buying back into it.

  • Reply to

    MPW-Mark

    by helmetguru123 Jun 5, 2014 11:24 AM
    marklibera marklibera Jun 5, 2014 12:03 PM Flag

    Guru, the chart looks great. MPW should make it back to previous highs. On both the fundamental and technical side, there looks to be clear sailing -- but it could take some time. Of course, the flip side is if they mess up by overpaying for an acquisition or if the overall market should suffer a set back. Sometimes when everything else seems to be going straight up, you have to remind yourself to be patient. I've owned MPW for a little less than a year and GPT for a little over a year and both are moving up slowly, but both have more than respectable returns. Now I hope that I haven't jinxed it.

  • Reply to

    NAT, NAO

    by keebon Jun 4, 2014 8:40 PM
    marklibera marklibera Jun 5, 2014 11:53 AM Flag

    With all of the bad news coming out of China and their property and other bubbles bursting, if I was looking at shipping, I would stick with those involved in energy. There have been a few articles about the exporting of ethane from the nat gas that is being produced in the Marcellus and Utica. That's one of the reasons that MLPs like EPD, NGLS (I own the gp TRGP) and the gp ETE have been rocking, not to mention all the LNG stocks.

  • Reply to

    ECB pusing interest rates to negative...

    by rbgambler99 Jun 5, 2014 9:09 AM
    marklibera marklibera Jun 5, 2014 10:17 AM Flag

    Gambler, I'm afraid I don't know what the eventual result will be as there are so many headfakes and repercussions based on currency trading and carry trades. The ECB can't do QE like the Fed can, but even the Fed has failed at getting the economy going, as Japan has failed to get its economy going. It's all pushing on a string. There's lots of speculation where the money will go, and ever action has a reaction, and sometimes the reaction is worse than the problem that they were trying to solve.
    Here, I think it is about the reaction to the jobs number. The Fed remains on a tapering course and even a bad jobs number will keep them on that course as they have started to worry about asset bubbles that they helped create. A stronger jobs number could boost rates, but then higher rates hurt the economy, especially housing which is already hurting from higher prices.

  • Reply to

    OT: PSEC

    by marklibera Jun 3, 2014 2:57 PM
    marklibera marklibera Jun 5, 2014 8:21 AM Flag

    Kee, lots of MLPs have gone to the ATM program where they can raise good sums without doing a spo. Also, you are seeing more preferred issuances instead of common issuances. The pullbacks don't seem to ever come in the better run names.

  • Reply to

    OT. PSEC and KKR

    by jerseyvinny2 Jun 4, 2014 2:26 PM
    marklibera marklibera Jun 4, 2014 4:41 PM Flag

    Vin, I was thinking of the same thing earlier today but decided to hold on and try to buy one more time after the Russell rebalancing The fear is that we get a full market correction before PSEC can eventually recover and I end up with too large a position.
    I have the same dilemma with some underperforming MLPs that don't seem to be doing much (CMLP and EPB) but with my luck, as soon as I sell, they will be taken over. I can't sell too many MLPs in any one year because of all the ordinary income.
    On a separate note, I made a timely buy on some closed end muni funds last year. Many of these are still selling at 10% discounts to NAV and yielding 6%+ tax free. They got hit a bit today as the 10 yr rate rose to 2.6%. If rates rise to 2.8% after Friday's jobs report, I will buy some more as I think the economy is going to slow again. If we get a bad jobs number, I'll buy more immediately as rates could fall back below 2.4%.

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