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Analog Devices, Inc. Message Board

me_jade 39 posts  |  Last Activity: Jun 1, 2015 12:54 AM Member since: Jan 13, 1998
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  • Reply to

    Response to jrad

    by ayscuew May 30, 2015 6:54 AM
    me_jade me_jade Jun 1, 2015 12:54 AM Flag

    Finish.......

    As of April 1, WLKP bought another 2.7% for $135 million and that is a significant part of the model to achieve low double digit distribution growth. One of the Lake Charles plants is currently under expansion and will add 250 million/lbs per year of capacity which equates to 7.5% increase across all three plants (more distribution growth).

    WLK will pay WLKP a $0.10/lb profit margin on 95% of its ethylene production, the other 5% can be sold on the open market at prevailing rates which is currently greater than $0.10/lb. The profit margin is net of CAPEX, Maintenance......everything......which in effect makes WLKP for all practical purposes non-cyclic.

    The one problem.......with the recently proposed IRS regulation, WLKP will lose its status as a partnership in 10 years, if the currently proposed regulation is enacted. In my opinion, 10-years leaves lots of room for distribution growth. I shorted some puts recently when it cratered and intend to initiate a 600 share position this week with hopes it will crater further.

    Beware, Yahoo and Morningstar list most/all financial metrics like WLKP has a 100% share and this is confusing investors on the Yahoo message board.

    Nice chatting. I enjoy exchanging information with others that do their homework.

  • Reply to

    Response to jrad

    by ayscuew May 30, 2015 6:54 AM
    me_jade me_jade Jun 1, 2015 12:49 AM Flag

    jrad:

    Wow! Thanks for the detailed reply. You provided many more reasons to stay away from NRP. I'll still follow because it is an interesting situation. I won't buy unless it gets a lot cheaper and in essence becomes a long life stock option. I sometimes like $1-$4 stocks when there is some underlying value because they are in effect stock options. In 2008/2009, BAC became a stock option and was hugely profitable.

    Regarding NRP, I"m sorta hoping NRP will get in a cash crunch and sell it's OCI Wyoming stake to OCIR.

    SXCP is an interesting situation. It seems very solid but I consider it very risky. I bought and opening position of 600 shares at $22 even literally the day before it dropped below $20, at which time I added 200 more shares.....possibly out of frustration....lol. I plan to watch it closely and keep it on a very short leash. I plan to sell at the first hint of trouble. Very good point regarding which steel company legal entity is on the hook for the take or pay agreements.

    It's true chemical companies are cyclical but I think you'll like WLKP is you take a detailed look. WLK is the parent and is financially very solid. WLK owns a majority of the common units (currently subordinated) and of course the IDR's. WLKP is still in the 0% IDR split which makes it attractive. WLKP's sole asset is a 10.6% in WLK's ethylene plants and
    WLK has agreed to pay WLKP a net profit margin of $0.10/lb through 2026.

  • Reply to

    Response to jrad

    by ayscuew May 30, 2015 6:54 AM
    me_jade me_jade May 30, 2015 10:49 PM Flag

    jrad:

    Do you actually own NRP or are you just following? You clearly have a good handle on the businesses of NRP and OCIR. NRP may be a big winner someday but currently the risk outweighs the near term potential for reward. That said I intend to stay tuned.

    Do you follow WKLP or SXCP?

  • Reply to

    Co. is Hitting on all eight cylinders

    by reading_tee_leaves Mar 18, 2015 9:50 AM
    me_jade me_jade May 30, 2015 10:43 PM Flag

    Yahoo is reporting data incorrectly and thereby misleading you. Yahoo is reporting WLKP metrics as if WKLP owns 100% of OpCo. Prior to April 1, WLKP owned 10.6% and therefore only 10.6% of earnings, etc. Post April 1, WLKP now owns 13.3% of OpCo.

  • Reply to

    selloff

    by dennisrfm May 6, 2015 10:34 AM
    me_jade me_jade May 30, 2015 10:38 PM Flag

    The regulation has not been enacted yet (if it is ever enacted), the 10 year transition period has not begun yet.

    Does anyone believe that WLK management will back away from their stated plan to increase the distribution at a "low double digit rate" if the proposed regulation is enacted?

  • Reply to

    Probably worth 28 a shares at this point

    by newgrad2014 May 14, 2015 12:35 PM
    me_jade me_jade May 30, 2015 8:32 PM Flag

    I find WLKP interesting. I did short some puts recently but have not taken a long position yet, but plan to take a small position soon. Regarding your comments pertaining to valuation, I'm not trying to be confrontation, so please don't take my comments below that way. I'm still trying to understand this company and it's balance sheet. I THINK there is lots of confusion pertaining to WLKP metrics because WLKP prior to April 1, 2014 only owned only 10.6% of OpCo (13.3% post April 1), yet many financial metrics at Yahoo and even Morningstar are reporting a 100% share of OpCo's revenue, earnings, etc. Evaluating valuations gets confusing when evaluating a security that owns only a minority interest in a revenue generating business as WLKP does.

    - 12% distribution growth rate........your comment here appears correct based upon management guidance
    - Return on Equity.......80% looks far from correct
    - EV/EBITDA..........EV for WLKP ~ 700 million while Yahoo lists TTM EBITDA at ~ $644 million. For the TTM, I believe WLKP only had ownership of 10.6% of that EBITDA or $68.2 millon. This yields a rich EV/EBITDA at ~ 10.2X.

    I would be happy to be corrected, but these are the numbers I see.

  • Reply to

    Is MHR-D still paying dividends?

    by me_jade May 20, 2015 7:55 PM
    me_jade me_jade May 25, 2015 11:13 PM Flag

    Good to know. I was confused. Brokerage house are actually listing the next payment date one day before the x-dividend date, so I thought maybe something was wrong.

  • Is MHR-D still paying dividends?

  • Reply to

    This stock will EXPLODE it any news

    by nillydnyc May 12, 2015 3:56 PM
    me_jade me_jade May 13, 2015 9:18 PM Flag

    Explode which direction?

  • Reply to

    why is wmb being punished?

    by extremeprof May 11, 2015 2:26 PM
    me_jade me_jade May 13, 2015 9:09 PM Flag

    Fully valued? What?

  • Reply to

    A Peak at OCIR's K-1

    by me_jade May 10, 2015 5:48 PM
    me_jade me_jade May 13, 2015 1:31 AM Flag

    YHOO sounds like a good short candidate.

    I've been a heavy Yahoo Finance user since at least 1997.

    Site functionality has been on a slow steady path downhill.

  • Reply to

    You might want to buy this stock.

    by wyeth721 Feb 11, 2015 11:18 AM
    me_jade me_jade May 12, 2015 6:36 PM Flag

    bump

  • Reply to

    A Peak at OCIR's K-1

    by me_jade May 10, 2015 5:48 PM
    me_jade me_jade May 12, 2015 2:00 PM Flag

    Wow! I typed 3 or 4 lengthy replies to your message. It appears that Yahoo! has deleted my messages. I have no idea why.

  • Reply to

    A Peak at OCIR's K-1

    by me_jade May 10, 2015 5:48 PM
    me_jade me_jade May 11, 2015 10:18 PM Flag

    And finally, you seem knowledgeable with respect to MLPs. I would be interested in sharing lists of best positioned MLPs. I follow many of the O&G midstream pipeline and gathering & processing MLPs fairly closely. I have a fair amount of insight into O&G midstream operations as I have worked in the industry my whole career.

  • Reply to

    A Peak at OCIR's K-1

    by me_jade May 10, 2015 5:48 PM
    me_jade me_jade May 11, 2015 10:13 PM Flag

    Wells Fargo publishes an MLP Primer which is by far the single best source of information I am aware of. Within the document, Wells Fargo estimates the approximate tax deferral percentage for all MLPs trading at the time of publication. OCIR is too new to be in the October 2013 publication.

    Thanks Again!

  • Reply to

    A Peak at OCIR's K-1

    by me_jade May 10, 2015 5:48 PM
    me_jade me_jade May 11, 2015 10:12 PM Flag

    On a related topic, you said……….

    “Like most MLPs, OCIR has made what's called a Section 754 election. This election allows OCIR to compute a depreciation deduction for each partner based on the amount that each partner paid for his/her units. So the more you pay, the larger the deduction, and conversely, the less you pay, the lower the deduction. When you sell your units, this deduction gets recaptured as ordinary gain.

    So you could ask 10 unit holders what their K-1s showed, and you could legitimately get 10 different answers.

    I paid an average price of $ 18 for my units. So if you were to buy today at $ 24 your line 1 - 19 losses would presumably be larger than mine.”

    I’m not familiar with the Section 754 election but I plan to research it. Your comment related to the depreciation deduction calculation is NOT consistent with my understanding (perhaps my understanding is not accurate).

    I own roughly 20 MLPs, and for every MLP I am able to trace the increase/decrease in my tax basis each year based upon my share of all earnings types (adds to tax basis), my share of all earnings losses (subtracts from tax basis), my realized distributions (subtracts from tax basis), plus/minus my purchases/sales of units during the calendar year.

    It is my belief that each limited partner is allocated income, losses, deductions, etc by “Item J” on your K-1, “Partner’s share of profit, loss, and capital”. The percentages only seem to change when shares are bought or sold.

    It is/was my belief that these percentages are based upon number of shares purchased, but perhaps it is based upon dollar amount contributed(?). That said, why do these percentages not changes when the MLP issues more shares? Perhaps I need to study the topic.

  • The more I look at OCIR, the more interested I'm getting.

    I'm really curious what percentage of OCIR's distributions are tax deferred. If you owned OCIR throughout 2014, would you be willing to share information from your K-1?

    If yes, please reply to this message detailing the amounts in boxes 1-19, plus the number of shares you owned during 2014.

    Thanks in advance!

  • Reply to

    Holding company performance fees are out of control!

    by halvmbs5 Apr 15, 2015 12:18 PM
    me_jade me_jade May 9, 2015 9:38 PM Flag

    It's so interesting all the "thumbs down" ratings on the posts questioning management compensation. There are only two conclusions: (1) The thumbs down are connected to those benefitting from the management compensation structure, or (2) The thumbs down are by those unable to comprehend how far out of proportion the compensation is relative to the magnitude of company revenue and earnings.

    There is no need for this. The compensation structure could be brought in line with reality and there would still be more than enough compensation make the management team wildly wealthy.

    If something doesn't change in the near future, this LLC will fade from a top performer to dead money into perpetuity.

  • Reply to

    PF is bidding to buy GREEN GIANT

    by discdriver Mar 12, 2015 3:28 PM
    me_jade me_jade May 9, 2015 6:02 AM Flag

    I don't think so!!!

  • Reply to

    The Bear Case

    by me_jade Apr 29, 2015 7:50 PM
    me_jade me_jade May 8, 2015 7:07 PM Flag

    Many thanks for your thoughtful comments. After reviewing the latest earnings and reviewing the industry fundamentals again, I recognize that there is risk but I feel comfortable with my modest 600 share position. I may even add to my position if there is weakness due to broader market conditions, which I think is likely.

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