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Global Partners LP Message Board

marklibera 445 posts  |  Last Activity: 15 hours ago Member since: Aug 14, 2007
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  • Reply to

    Cash distribution

    by joencarl 23 hours ago
    marklibera marklibera 15 hours ago Flag

    I would think they would. Those that made profit on the arbitrage with TRGP will be unwinding those positions. Plus, I don't know if the 'when-issued" shares could be shorted, so once the spinco starts trading, those shares should be eligible to be shorted. Despite the high yield, the next distribution is not until May and is going to be pro-rata for the time that it is public. Shorts won't have to worry about paying a large distribution.

  • marklibera marklibera 20 hours ago Flag

    bob, for what it is worth, I managed to get out of several positions last year with small losses before they really started to plunge. But then I cleaned out a bunch of my midstreams, only to see, them bounce. It is always a difficult decision to sell something at a loss and one has to try to discern if there is support. Recently, I missed selling IRM when it missed earnings, but it looked like it hit support, and I decided to hold for a bounce.

  • Reply to

    nymt

    by bayman667 Feb 24, 2015 7:19 PM
    marklibera marklibera 21 hours ago Flag

    People think I am bashing NYMT, but I am trying to point out how some metrics for certain sectors are not as important as with other sectors.
    For mREITs, GAAP earnings are not as important as they are for regular C- corps. That doesn't mean that an mREIT stock won't move when their earnings are released, because many retail investors don't understand this nuance and also many algorithms are programmed to read the headlines and trade based on that news.
    For mREITs, the key metrics are spread, leverage, price to book. NYMT is a hybrid mREIT, so there is an extra level of complexity in their financials. Unlike the agency mREITs, NYMT does better when interest rates rise (although the market and retail investors sometimes think that rate increases are bad for all mREITs).
    One of the biggest issues with mREITs and NYMT in particular is that posters do not understand how a REIT dividend is determined, and they keep trying to use the GAAP earnings as a surrogate for taxable earnings determined under the tax code which is how the dividend is determined.

  • Reply to

    Quarter Special Dividend?

    by jimcooper28 Feb 25, 2015 8:44 PM
    marklibera marklibera 21 hours ago Flag

    What is “taxable income?” Generally, financial reports point out the distinction between GAAP income, non-GAAP income, and taxable income in excess of GAAP income. After pouring over NYMT’s financial reports, I could find no distinction between “net income” and “taxable income.”

    To answer your question, taxable income is income that is determined under the rules of the tax code (e.g. as would be reported on their tax return). You are taking their GAAP income and trying to come up with their taxable income, but you only have the GAAP info.

    Posters should stop trying to determine if NYMT is going to increase their dividend or pay a special based on their disclosure of GAAP income. You don't have all the info you need to determine whether a dividend increase is required.

  • Reply to

    O/T...bought KCAP today....14% yield

    by rbgambler99 Feb 24, 2015 1:10 PM
    marklibera marklibera 21 hours ago Flag

    Keebon, don't get hung up on book value. Tangible book value is a better metric, but as we saw in the financial crisis, one cannot put too much faith in a company's book value if it is mostly Level 3 assets in which they get to make up their own values.

  • Reply to

    Recommendation

    by jbcguy Feb 24, 2015 10:23 AM
    marklibera marklibera 22 hours ago Flag

    ARP announced on Feb 23. The headline was about the new financing and they buried the reduced distribution.
    The joke is that the management of ARP is the management of ATLS so for ATLS to have put out an Information Release two weeks ago with the $2.20 number is ridiculous, if not fraudulent.

  • Reply to

    New ATLS valuation based on book value

    by spinofflange Feb 25, 2015 5:53 AM
    marklibera marklibera Feb 25, 2015 12:35 PM Flag

    Why does book value matter? Book value is an accounting metric that doesn't indicate anything about the market value of the company's assets. Also book values can change as impairments are taken. The 10-12B filing had the September numbers. I bet they take some charges when the 10k comes out.
    When trying to value something like an MLP, you have to use the valuation metrics that the industry and analysts use like DCF multiples and EBITDA.

  • Reply to

    Dividend Question

    by neobliviscar Feb 25, 2015 9:51 AM
    marklibera marklibera Feb 25, 2015 12:21 PM Flag

    Going to wade into this discussion. I don't know where you got your number, but if you got it from their SEC filings, then it is most likely a GAAP number. Sometimes mREITs will report the taxable earnings number in the 10K in one of the notes, but usually the 10k is filed before they have finished compiling their tax return.since the filing date for the 10k is due before the tax return is (and tax returns can get extended).
    There is much to much focus on whether they can raise their divy. People should look at the cashflow statement to see how their cash is generated. That would give a better indication of whether a dividend increase is in the cards.

  • Reply to

    O/T...bought KCAP today....14% yield

    by rbgambler99 Feb 24, 2015 1:10 PM
    marklibera marklibera Feb 25, 2015 12:08 PM Flag

    Stagg, again, Total Returns is a metric that measures the past, not the future. You used to brag about SDRL's total return, but how did that help you avoid a 75% collapse and an elimination of the divy? It did not.
    As for my approach, I wouldn't be invested in some of the sectors that I invest in if I didn't like income, but I just don't pick my investments by a faulty indicator like their current yield. When you go looking for value, you have to watch out for value traps. All during SDRL's plunge from the $40 level, SDRL was a value trap, yet you insisted that it was undervalued. If you are reinvesting your dividends in value traps, then you are not getting the benefit from having stocks that pay good dividends.
    The funny thing is that all of the oil and gas stocks that have gotten crushed probably have very negative Total Returns for the most recent years. Some of these could go out of business and produce an even greater negative Total Return, but some could bounce and produce a huge positive Total Return in the future. It's not just about reinvesting dividends, it's about reinvesting them in the right companies.

  • Reply to

    NYMT out with a very good

    by bobdbeck Feb 24, 2015 5:12 PM
    marklibera marklibera Feb 25, 2015 10:33 AM Flag

    Vin, I have spoken numerous times about my belief that the Fed can't really raise the Fed funds rate. They may raise their target, but the actual price of Fed funds is likely to stay below their target. The Fed can then claim that they raised rates without rates actually going up.
    As for the reaction of mREITs, rising rates can be a plus for mREITs that specialize in credit sensitive assets, like NYMT because the theory is that rising rates means an improving economy and a rising demand for credit assets (away from the safety of agencies) and rising values of the underlying properties that collateralize these mortgages. So some mREITs can go up in a rising rate environment, but the market sometimes knee-jerks in different directions.

  • Reply to

    NYMT out with a very good

    by bobdbeck Feb 24, 2015 5:12 PM
    marklibera marklibera Feb 25, 2015 10:28 AM Flag

    Bob, as I usually do whenever anyone starts talking about divy increases for mREITs, is to warn everyone that the GAAP earnings are not indicative of the company's ability to increase their divy. So pay no attention to the apparent gap between the 42 cents quarterly GAAP earnings and the 27 cent dividend.
    When NYMT files their 10k and the cashflow statement becomes available, we will be able to see how much cash actually came in the door, versus all the accounting gains.

  • Reply to

    O/T...bought KCAP today....14% yield

    by rbgambler99 Feb 24, 2015 1:10 PM
    marklibera marklibera Feb 25, 2015 9:29 AM Flag

    Wells BDC top quartile picks: GBDC HTGC TSLX ARCC TCAP and NMFC. They were particularly high on TCAP, but the report was issued in early Jan.

  • Reply to

    O/T...bought KCAP today....14% yield

    by rbgambler99 Feb 24, 2015 1:10 PM
    marklibera marklibera Feb 25, 2015 9:28 AM Flag

    Stagg, the yield is a function of what a company pays and its stock price, but it is a dynamic statistic because the stock price is always fluctuating and the dividend/distribution depends on what the company earns going forward. The dividend/distribution is a historical figure because with companies like BDCs and mREITs, their divies can fluctuate. Technically that is true for all companies, but regular C corp operating companies usually pay out less of a percentage of their earnings or cashflow that you don't see as much fluctuation in the dividends (at least you don't see as many dividend declines).
    So even though yield is a backward looking statistic that incorporates a dividend that has already been paid in the past (as opposed to the future) it can be instructive when comparing companies in the same sector. As I said, yield is a function of both the stock price and the dividend. If the stock price declines, the yield increases. So an increasing yield can be a sign that the stock price is declining (unless the dividend is increasing). That is why when companies increase their dividends, their yields usually decline because their stock prices increase as a result of the good news that their divies are increasing. As an example, SDRL and several of the e&p MLPs saw their yields increase to over 20%, not because their divies were increasing, but because their stock prices were falling. Then they cut their divies.
    The other thing that usually happens when a stock's yield increases from the declining stock price is that their bond yields are also increasing. Increasing bond yields make it more expensive to finance deals, meaning they make less money.
    It is a fact that companies with growing distributions have growing stock prices. Companies can change their trend through superior investment selection or through the use of more leverage. However, we have seen the risk of what happens when a company uses too much leverage.

  • Reply to

    O/T...bought KCAP today....14% yield

    by rbgambler99 Feb 24, 2015 1:10 PM
    marklibera marklibera Feb 25, 2015 8:35 AM Flag

    I spent some time going through the Wells report on BDCs to see what they had to say. They issued a large report at the end of December. In general, they were positive on the BDC sector, but while KCAP was included in the list of companies that they reviewed, it did not make it into any of the quartiles that they rank, probably because it is relatively small compared to the many others that they cover. There's a lot to understand about BDCs, what they invest in, how they are funded and how management is compensated, and there are several companies, some with longer track records than others (makes mREIT analysis look comparatively simple). Anyway, on the technical front, it looks like KCAP has plenty of resistance ahead and the general chart is still in a downtrend. For me, it's always hard to buy a stock that has been in a downtrend and is now rallying because you don't know if or when the rally is going to run out of gas or if it is going to break through resistance. Stagg, will debate it, but stocks with yields larger than competitors in their sector, have a higher cost of capital which makes it harder for them to compete with these competitors for deals. I think the better BDCs are yielding in the 8-9% range. I'll try to post the stocks in Wells top quartile.

  • Reply to

    O/T...bought KCAP today....14% yield

    by rbgambler99 Feb 24, 2015 1:10 PM
    marklibera marklibera Feb 24, 2015 3:28 PM Flag

    Looks like KCAP already has had a nice rally. Why do you think it continues? Please don't say because it is yielding 14%, otherwise I will change your nickname to Stagg.

  • Reply to

    CMLP

    by palestone Feb 24, 2015 2:16 PM
    marklibera marklibera Feb 24, 2015 2:53 PM Flag

    Results came in ok. I think they were still below 1 coverage ratio for the 4th quarter, but they guided higher. But they said the same thing last year and could not produce a growing distribution. The stock could rally but the analysts will digest the report and conference call and have their recommendations out soon. Unless the big MLP analysts get behind this, it is not going to go far. Last year, Wells put out a buy on it, but removed it when the company underperformed. They might have lost confidence in their ability to perform.
    The yield is high and looks to be sustainable, but I'd rather have growth. They could have problems if the Bakken slows or because of a negative reaction to negative news from Quicksilver.
    I think I just talked myself out of adding. I had a small position from back when they took over from Quicksilver and sold recently. The only thing that keeps me moderately interested is the fact that they could try to sell the company to someone.

  • Reply to

    Please answer

    by hd317 Feb 22, 2015 1:22 PM
    marklibera marklibera Feb 24, 2015 2:31 PM Flag

    Feel free to compare the charts of something like EPD or MMP with CMLP. When I first started investing in MLPs, I made the mistake of inveting in the highest yielding ones and passed (initially) on EPD, MMP and some others. The ones that grow their distributions also grow their stock prices, while the ones that don't grow their distributions, stagnate. EPD is a double since I bought it. If you think about it, this makes sense, because a growing distribution is the result of growing cashflow. The growing distribution lowers the cost of capital which makes it cheaper for the MLP to buy or build new properties/pipes which then add to the bottom line, leading again to increased distributions.
    Last year, CMLP also projected a growing distribution and they failed. They may have overpaid for some of their properties. This may rebound on better guidance, but I don't think they have any believers since the same thing happened last year. However, they could put the company up for sale if they don't get on the right track soon, but I wouldn't expect a home run in a buyout scenario.

  • Reply to

    Please answer

    by hd317 Feb 22, 2015 1:22 PM
    marklibera marklibera Feb 24, 2015 11:54 AM Flag

    Well the first thing is to understand that those MLPs that yield the highest may not be the best to invest in. The ones to invest in are those that grow their distributions the most. That is why some of the MLPs with lower yields are doing better, because as they grow their distributions, their stock price increases. The second thing is to look at coverage ratio (basically the ratio of their DCF to the distribution) to make sure they have plenty of room to keep paying their distribution at the current rate. And then you have to make sure they don't have too much debt, because a breach of debt covenants can prevent them from paying their distribution. Finally, if you own in a taxable account, you have to understand the tax accounting and K-1's.

  • Reply to

    o/t apple at all time highs

    by madmax19471952 Feb 20, 2015 4:03 PM
    marklibera marklibera Feb 24, 2015 9:42 AM Flag

    Sarge, I'm sorry if I was too blunt. Apple may very well be one of those "get it and forget it" stocks to always hold and never sell (except if you are trading around a core position) as long as they keep turning out premium products.
    If you look at a two year chart, you see a very nice upward sloping chart with no sign yet that it is rolling over. But you also see that almost every time that it gets over the upperbound of the trend, which usually correspond with the RSI going over 70, it pulls back. Some of these pullbacks are sideways, but some are about 10%.
    We are all human and what separates us from professional investors is that we tend to let emotion get in the way of financial analysis. When we have a great winner, we become afraid of selling it because it has served us well and then it becomes possible to miss a trend change. Sometimes its better to let someone else have the last 10% rather than lose 10% because you got greedy.

  • Reply to

    o/t apple at all time highs

    by madmax19471952 Feb 20, 2015 4:03 PM
    marklibera marklibera Feb 23, 2015 6:54 PM Flag

    Sarge, I disagree. You have to look at the actual products and their growth.
    As for the stock price, at some price, it becomes fairly valued and then overvalued. When everyone owns it, who is left to push the price up further?
    What are their margins on Macs? What are their margins on Apple pay? Do they even sell Apple TV or cars yet? The bigger Apple gets, the harder it is to move the needle and the more likely they can disappoint.
    A few years ago, Apple approached $700 and then it hit a hiccup and sold off. the stock went from $700 to $350. While those who held are still ahead now, those that sold and bought back lower are ahead more. There was time to see that the new iphone was actually delivering and not just some big hope.
    I've been watching these boards for a long time and it never fails that whenever someone starts bragging about a particular stock day after day after day (and you are starting to be a one song singer lately) and how great it is, it's a sign that they are falling in love and not objectively measuring the valuation. That's usually when people start losing profits. This doesn't mean that you should sell Apple, but just means that you should be more skeptical of future growth until at least they are producing that new product and it is showing signs of gaining a profitable following.
    I am happy for you that you are making a lot of money, but you don't make the money unless you sell.

GLP
39.06Feb 26 4:02 PMEST

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