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Enterprise Products Partners L.P. Message Board

mizzou1966 10 posts  |  Last Activity: Apr 29, 2016 9:08 AM Member since: Sep 4, 2005
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  • Reply to

    confusing release

    by marksharky Apr 28, 2016 8:08 PM
    mizzou1966 mizzou1966 Apr 29, 2016 9:08 AM Flag

    Most people do not understand the important numbers when evaluating GPs that derive their funds from their underlying MLP. This is especially true for TEGP. You can basically forget revenues and eps. The important numbers are the three sources of funds derived from TEP: (1) The GP payment; (2) The IDR; and (3) The distribution on the TEP units held by TEGP (currently 20M units). For Q1, the grow was +14.6%, +29.2%, and +10.1% for these payments into TEGP. The two main expenses to TEGP currently are the interest (+5.4% Q/Q)and the G&A (flat at $500K). Bottom line: Cast distributions to Class A and Class B were +21.4% Q/Q and the Class A shares outstanding remained unchanged. My model was showing 12% dividend growth Q/Q for the next three years. I have not increased it, yet. I'll wait for the actual dropdown of the first 1/4 of REX. If all goes well, I will consider raising my quarterly dividend growth to as high as 15% for the following three years. If the first 25% of REX is dropped down in May-June, then I look for two more dropdowns in spring 2017 and 2018. That does depend upon decent financing (debt/equity) options for TEP. Note: Financing options for the current proposed dropdown are basically in place. TEP needs the added size to get to IG (investment grade) rating. This is very positive for 3-5 year plus growth. The biggest question mark: Will financial markets turn more positive to allow these transactions to occur? At current prices have a weak BUY on TEGP. I'd like to buy lower; hence, I have sold puts for premium and or lower priced purchases. Disclaimer: Long TEGP and short TEGP puts.

    Sentiment: Buy

  • Reply to

    Earnings Report and CC Thursday after the Close

    by mizzou1966 Apr 26, 2016 2:36 PM
    mizzou1966 mizzou1966 Apr 28, 2016 2:29 PM Flag

    Nice action on the stock price yesterday early and beginning about noon today. I'll just forget about yesterday afternoon's sell off. Actually used it to buy a fey hundred more shares under 19.85. My point is that the price action (especially yesterday morning) coming into earnings looks positive. I may be totally wrong, but with TEP earnings forecast being positive...how can TEGP forecast be at .11? With a clear beat (in the .20-.30 area), we could see a nice pop to the 22-23 area. CEO says they do not manage the business or distributions/dividends or a quarterly basis. That said, if dividends increased 21% Q/Q, IMO earrings will be at least reasonable and maybe very good. Expect to read the quarterly report and listen to the CC within the next 2-3 hours. I still rate TEGP a BUY (up to 24) and may increase that depending upon the numbers and comments after the close. My one and two year targets are 27 and 43 (based on 60% annual growth from the 17 dollar stock price just prior to the April dividend announcement. One word of caution: TEGP and TEP do very little IR or promoting. The news can be very sparse other than dividend/distribution and earnings releases/conference calls. Yes, there are occasional presentations; however, they are far less than monthly...and...management has a stated policy to only update forward projections once a year. This leaves smaller investors to have to read between the lines. The forecast was for ~10% Q/Q dividend increases for 2016-17. The past two have both exceeded 20%. I am using three models with 10%, 12%, and 15% Q/Q dividend increases going forward. IMO, the lower is a conservative estimate. The middle one is a realistic estimate. The 15% one is if oil and gas move somewhat higher, the stock price follows (or exceeds). Key point: IMO, TEGP could be a huge winner over the next 3-5 years....but...it will take TIME.

    Sentiment: Buy

  • mizzou1966 mizzou1966 Apr 27, 2016 10:47 PM Flag

    $1.9B debt for a $26.48B market cap company is pretty conservative. Also, company revenues are estimated to grow 7%+ for 2016. Have not Idea where you are getting your estimate. Finally, you're close of the 5 year eps estimate which currently is 16.4%. Five year target price (Gunderson Capital, San Diego, CA): $495.

    Sentiment: Buy

  • With the stock in the 19.75-20+ area, the recent 21.3% dividend increase, and the latest estimate .11, I am looking for a nice beat. My 5-year target price: 114 to 278. How do I get this? The low figure is based on 10% per quarter dividend and price increases. The high figure is based on 15% dividend and price increases. Will TRGP do this? Who knows; but after reviewing (many times) everything published by the various Tallgrass partnerships, I see this as a real possibility.

  • Terrific week for TEGP. It needs to get back above the IPO price (29). It may take awhile; however, 10-20% distribution increases per quarter sets TEGP apart from all the other MLPs and GPs. I'm downgrading from buy to HOLD based on valuation...at least until Q1 earnings and CC.

    Sentiment: Hold

  • Reply to

    Dividends announced

    by davoud1 Apr 20, 2016 6:13 PM
    mizzou1966 mizzou1966 Apr 20, 2016 7:58 PM Flag

    Stable dividend is very good...for the next 3-4 quarters. First time we see an increase should be party time.

    Sentiment: Buy

  • mizzou1966 mizzou1966 Apr 20, 2016 3:47 PM Flag

    EQGP looks fine...if you don't mind K-1s. I had a mess of them in 2015 and swore to never my a partnership again that generates a K-1. TEGP is taxed as a corporation so it does not generate a K-1, on a 1099...and there should be no taxes on the distributions through at least 2017. I'll stick with TEGP, PSX (cover calls), PSX short puts, PSXP short puts, and SHLX short puts for the foreseeable future. TEGP stock has really moved this week, so I'll just accumulate cash in hope of buying lower sometime in the next month or two. If not, I'm fine with the capital gains and (expected) increasing dividends. TEGP IPO was at 29, so it has a long way to grow. If distributions continue in the 40-60% plus annual increase area, TEGP could be a starter the next five years.

    Sentiment: Buy

  • mizzou1966 mizzou1966 Apr 19, 2016 6:57 PM Flag

    Not yet. Thanks; I'll research it.

    Sentiment: Buy

  • IMO, Tallgrass Energy GP totally misunderstood. Virtually no PR (aside from distribution/dividend announcements, earnpbs/conference calls, and an occasional presentation. Results? Stock is --42% from the IPO price of 29; however, the dividend is +57.9% more than the IPO indicated (minimum) rate. With the stated goal of doubling the rate of increase in the TEP distribution during 2016-17, TEGP is on the path to 40% plus dividend increases for this year and next. My estimates for 3Q17 dividend is in the 8.8-11.5% range based on Friday's closing price (16.75). I normally just sell short term puts; mostly for the premium and occasionally to pick up a stock I really like at a discount. For TEGP, my Apr15 puts just expired and the May15s have five weeks to run. Also, adding more shares (for a long hold) under 17. Best why to learn about TEGP is to read (or listen to) every conference call and presentation for both the underlying LP (TEP) and the GP (TEGP). It is a lot of work, but the payoff could be huge in 5-7 years when the dividend could be 20% plus and still growing...that's based on the current price. Be aware that Tallgrass Development has projects (for many years to come) to dropdown to TEP. Next one might not be till 2017, but all the dropdowns will, mostly likely, lead to more TEP units. This is one of several ways that TEGP benefits and keeps the dividend growing at double, or more, than the TEP distribution increases. Earnings estimates are very low for Q1 and 2016 overall. If the Q1 number is very good, very soon the mid-teens may be a distant memory.

    Sentiment: Buy

  • Reply to

    anyone brave enought to buy more here?

    by timeforacrash Mar 11, 2016 2:30 PM
    mizzou1966 mizzou1966 Mar 11, 2016 6:04 PM Flag

    No, but idid sell Mar 11 44.5 puts and Apr 40 puts for $1431 this week. The first puts expired worthless today and Apr 40s are OTM by over 18% (and have a delta of 12.3 with five weeks remaining. If someone wants to buy this or most any stock with decent options liquidity, a good idea is to sell short term cash secured puts just under the market. They will then either pocket the premium and move on or buy the stock cheap than if they directly purchased the stock.

    Sentiment: Hold

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