Read the SEC filings.
kbon, you have to be careful when trying to determine the reasons why mergers (in any industry) are taking place. It takes two parties to merge -- so inherently the target must have decided that it was not worth trying to go it alone. The acquirers may simply be running out of organic projects and find it easy to do financial engineering. I'm not a naysayer on mergers, but they don't always work out for shareholders.
You mention the midstream sector broadly, but there are distinctions between pipes and processors. To me, MWE selling out is a sign that the processors see weakness ahead.
As I understand it, NGLS prices closely follow oil prices, so 45% of their mix is related to oil. Kind of counters your headline.
I am always wary of averaging down as in many cases it could be throwing good money after bad, but HTGC has been on a one-way ticket down since I bought it and it is due for a bounce. There looks like some resistance at $11.75 that might be getting cleared which would open up a move to the 50 dma at 12.31 or even 12.75. I think I remember reading that one of their portfolio companies, Box something, went public last quarter and they may have cashed a payday which hopefully spills into their earnings reports.
Bob, at one point I think MWE had turned down a purchase from KMI over $80 a couple of years back. It shows you how much the prospects have changed that MWE would sell out at this price. There's been growing talk about a new shale developement in Kentucky -- I think it's called Rogersville (you've probably seen the posts on the i.v. board about it) in which MWE was going to be in the middle of it.
Wonder who is next.
helmet, I almost put your picture on a milk carton since you've been absent for so long. Glad to have you back, but your HTGC has been a dog. Maybe it turns up from here.
Maybe the players are bidding up some of the other names in the index on further merger mania possibilities.
Since someone raised the point about the US being a safe haven over the rest of the world, I thought I would actually check the returns. So here are some of the major world indices, YTD and 52 week % change (this is from the NY times):
Dow: -0.4 and 5%
Transports -10.3 and -0.29
Util -7.6 and 1.52
Composite -4.5 and 2.86
S&P 500 0.9 and 5.7
NAS composite 5.5 and 13.68
NAS 100 4.3 and 13.92
Rus 2000 3.9 and 7.76
DAX 15.9 and 17.15
CAC 40 14.8 and 13.99
fTSE 1.6 and 0.02
Nikkei 13.6 and 29.99
Shanghai B 18.1 and 52.29
Sensex 0.6 and 9.02
The events in China and Greece are no doubt going to effect the major indices in those regions with China perhaps playing a bigger role in the economies of the Pacific. But the Japanese market is benefiting from a combination of huge money printing and their big pension funds buying stocks to replace bonds. In Europe, I don't think whatever happens with Greece will have a major effect on European economies unless the Greek banks implode and take down other European banks. Draghi has pledged to "do whatever it takes" in terms of QE and if Greece isn't resolved, they are going to print like mad to save the rest of Europe. The European economy may be slow to recover, just like ours was, but the QE efforts will flow into the big European stocks, who like our companies, will use it to pay down debt, buy back stock and increase dividends. The lower Euro should help their bottom lines too.
I think it's time to do some research on big European stocks with good dividends that have good charts.
Stagg, you really ought to check your facts before you make some of these statements. I will use SDRL to illustrate your mistake.
The first mistake that you make is relying on GAAP earnings. As you should know, for many stocks, GAAP earnings do not matter as much as EBITDA (especially with MLPs). Here are the stats on SDRL's EBITDA for the last several quarters starting in 3/14: 624, 641, 635, 672, 711. So as you can see except for the dip between Q2 2014 and Q3 2015 from 641 to 635, SDRL's ebitda has been on the rise yet the stock continues to decline through this period.
The GAAP earnings are more in line with your view as they did decline: 74, 67, 62 and 63 are the last 4 quarters.
But when were these earnings released to the market and when did the stock start to decline?
The first earnings decline (from 74 to 67) was from Q2 to Q3 in 2014 and was announced in November 2014. But the stock had already declined from a high of $37 in Sept to the low $20s when the earnings were released in Nov.
Similarly when the earnings rose from 62 to 63, the stock still declined.
So it is not as simple as you state. Maybe the stats on the others stocks better align with your theory.
Finally, I noticed that the earnings of PSEC have declined 32 to 28 to 27 to 26, but you have been a strong advocate of that stock even as it continues to decline So which is it Stagg, do you really use earnings trends or not because PSEC's is going in the wrong direction, and so is the chart (and the dividend too).
Keebon, think of it this way. We know it gets cold in the winter and the demand for heating fuel increases. That's why heating oil futures start to increase from their lows in summer. We know it's going to get colder but we don't know how cold the winter will be, but that doesn't stop the price of heating oil from increasing from the summer lows.
Similarly, when the demand for a stock changes or when supply changes (more sellers), that is embodied in the chart and other technicals like RSI. We may not know the reason for the change, but those investors may be anticipating a change in earnings or more importantly, a change in PERCEPTION.
We have all seen p/e multiples expand when a stock's earnings increase, but then all of a sudden the multiple stops expanding even though the earnings keep growing.
My knowledge of all the different technical metrics may not be the best, but I know it has saved me from chasing stocks that are overbought and sometimes has lead me to sell a stock before real damage occurred. Two times it worked recently are with SDLP (bailed out at $21, now $12) and IRM (sold at $35, now $30). Also, I don't have enough of a grasp of technicals to buy or sell a stock based on technicals alone. I like to see a fundamental story that I can understand and a technical picture too.
Not sure about that uptrend being in tact. The stock did get to oversold reading on the RSI yesterday so it was due for a bounce and there appears to be support at $117. But if things are so rosy with aapl, why has it been flat since March?
BTW, the only thing that matters with aapl is the iphone. Everything else is too small to move the needle, but the talking heads have to talk about something as if it mattered.
Kbon, take a look at ORC today. JK mentioned it in a post. Do you think the charts were telling us that something was amiss when the stock broke down in late June under the 200 dma? The dividend cut gets announced today and the stock falls another 15%, but the breakdown in the chart wasn't useful info?
There's an old saying that Wall Street leaks like a sieve and info gets out. ORC's dividend cut got out into the market before it was announced or the traders who really analyze a company saw that the divy was unsustainable and jumped ship before the boom was lowered.
Kbon, you have expressed doubt of the predictive value of charts. I'm not saying that charts predict with 100% accuracy what will happen with a stock. However, many times the charts reflect what the market thinks about a stock. Sometimes there are false moves and sometimes the chart reacts to a surprise announcement. However, many times the direction of the chart changes before fundamental changes are disclosed, but the traders who move the stock are anticipating a change in the fundamentals.
LINE had many events effecting its stock price, including the Hedgeye short attack and the SEC investigation into their accounting practices plus the resetting of the Berry acquisition price. EVEP's chart flipped when it appeared that they would not close a sale of their Utica assets. In EVEPs case, the "market" realized that the Utica sale was not going to happen, before the company finally admitted that the sale fell through.
As to whether "no one" predicted the precipitous drop in the price of oil, I'm sure there were plenty of traders and others who were predicting this, they just don't get or want the media exposure that we normally see.
You have said that charts are nothing but a historical depiction of trading, but that history is important as it represents what the supply and demand is for a particular stock. Like it or not, charts are used for trading and when key technicals are broken, sometimes it doesn't matter what the fundamentals are saying. Perfect examples are HTGC and HRZN, both of whose charts have broken to the downside after key technicals were violated, yet I haven't heard anything negative from the fundamentals and prior coverage by Wells Fargo in Jan had predicted that BDCs were going to rebound.
Past returns are not a guarantee of future performance. Many stocks (like SDRL, LINE and EVEP) had great Total Returns at some point, but then they hit an inflection point and those gains were wiped out. Those who talk about Total Returns never actually produce an example of what price and date they reinvested their dividends (as most Total Return calculators assume when the dividends were reinvested). So without actual proof, it's hard to believe someone took all their dividends in PSEC for example and invested them in NRZ (at its lows) and not in HTGC at its highs. Because money is fungible, income from other sources, can be combined with dividend income, and invested in something that goes up, but then it's claimed that the reinvested dividend always produced a profit, but when an investment produces a loss, the source of that capital was from other income.
Again, it's a message board and sharing of personal info is not recommended, but I find it unbelievable that so many stocks that we have been recommended by some (PSEC, KCAP, SDRL, MLPL, ) have really terrible charts, yet we are to believe that the dividends produced by those stocks were reinvested ONLY in stocks that have gone up and not into this long list of weak sisters.
Well "recovering in time" is the question. How long will the recovery take and can companies like ARP stay solvent during this time. Eventually they are going to have to pay down their debt and that comes from either cutting the distribution or dilution.
After the financial crisis, the Fed provided the liquidity to rescue the stock market, and if you remember, it took 3 rounds of QE to keep the market afloat while companies slashed their payrolls and started to buy back their stock. Who is going to rescue these e&p MLPs to keep them afloat until this recovery in energy prices materializes? Maybe private equity, but there is going to be dilution. Already there is some consolidation, but the ones that aren't acquired will face competition from stronger and bigger companies.