Sun, Dec 28, 2014, 4:02 PM EST - U.S. Markets closed

Recent

% | $
Quotes you view appear here for quick access.

People's United Financial Inc. Message Board

not_totally_gray 55 posts  |  Last Activity: Dec 26, 2014 3:42 PM Member since: May 14, 1999
SortNewest  |  Oldest  |  Highest Rated Expand all messages
  • not_totally_gray by not_totally_gray Nov 30, 2014 11:14 AM Flag

    If this market slump continues and HCLP languishes in the 30s or drops lower, it becomes a very attractive takeout play. With cash flow already booked for next year or two, do not be surprised if mgmt teams up with a private equity firm and takes it private. Remember, as a MLP, the GP can sell the company anytime they want, they don't need approval of the LPs like us. They could take it out for $40, lock in a very nice EBITDA multiple on the deal, re-price their stock options at current price, and do another IPO in 5 years or so when oil is hot again.

  • Reply to

    Retirement Plan

    by loper_35801 Oct 16, 2014 2:27 PM
    not_totally_gray not_totally_gray Nov 26, 2014 5:04 PM Flag

    "chuck" gets my nomination for Post of the Month...

  • Reply to

    Not sure what this means

    by huronsunrise Nov 21, 2014 9:42 AM
    not_totally_gray not_totally_gray Nov 25, 2014 3:29 PM Flag

    Are those bonds listed on an exchange? I've been buying the preferreds -- which have also gotten killed lately -- at about 8.6% yield, sounds like the bonds would be a better buy.

  • Reply to

    VNR Issues Preferred C Units

    by buyandwin Sep 10, 2014 10:10 AM
    not_totally_gray not_totally_gray Nov 18, 2014 12:47 PM Flag

    The B and C shares have been tanking more or less in tandem, the A shares still yield a bit less. Yield on B shares is up to 8.8%? And with VNR itself having an up day?

  • Reply to

    Why the Jump

    by fyshscale Nov 18, 2014 8:32 AM
    not_totally_gray not_totally_gray Nov 18, 2014 9:38 AM Flag

    My impression from reading the press release -- and making a good-faith effort to understand it, easier said than done -- is that ETE is basically being a good corporate parent and restructuring some deals to help out ETP. Didn't see anything that would benefit ETE to the tune of a 5% pop.

    It could also be that this is just the Part A prelude to a another deal to be announced, and someone has leaked info. But you'd have to be pretty cynical to believe that sort of thing happens in this day and age...

  • Reply to

    Holders of Incentive Distribution Rights

    by dearbear6 Nov 5, 2014 12:41 PM
    not_totally_gray not_totally_gray Nov 14, 2014 1:29 PM Flag

    I received a reply from IR about this issue -- here is what they said:

    "Thanks for your email, and for your interest in HCLP.

    You are correct - the majority of the $7.791 million allocated to the IDRs was not actually paid out to the IDR holders. The IDR payment is based on the actual distribution paid on November 14, 2014 of $0.625 per unit and was less than $700,000.

    The difference in the amount allocated and the amount paid to the holders of the IDRs is still retained by HCLP, is available for any general corporate purpose, including funding of future distributions to unitholders. The Distributable Cash Flow in excess of the distribution paid is not restricted in any manner or reserved for future distributions to only the holders of the IDRs."

    So the IDR payout was only about $695,000.

  • Reply to

    Holders of Incentive Distribution Rights

    by dearbear6 Nov 5, 2014 12:41 PM
    not_totally_gray not_totally_gray Nov 7, 2014 9:55 AM Flag

    Every MLP is at the mercy of the general partner -- that's the "limited" part of being "limited partners" instead of shareholders. Sometimes the MLP pays out outrageous IDRs. Sometimes there are lots of "management fees" that get paid out. Sometimes the GP or "sponsor" drops down assets at inflated prices. Sometimes the GP sells out or does other "strategic" transactions that benefit them but shaft the limited partners (like the recent Kinder Morgan deal). So this isn't anything specific to HCLP (or particularly outrageous, as these things go). But clearly the best MLPs are the ones who were forward-thinking enough to buy back their GP relatively early, like Magellan and Enterprise compared to Kinder Morgan. Once the quarterly distribution climbs above $0.71/qtr, half of all the additional cash flow will go straight to the GP as part of the IDR deal.

    ""The Sponsors" are the people who are making big time money." That's why lots of MLP investors have learned that the best way to invest is to buy shares of the GP instead of the MLP -- look at ETE vs ETP, PAGP instead of PAA, KMI instead of KMP, etc.

  • Reply to

    Holders of Incentive Distribution Rights

    by dearbear6 Nov 5, 2014 12:41 PM
    not_totally_gray not_totally_gray Nov 6, 2014 9:12 PM Flag

    I've gone through the math, and you're 100% justified in being confused. If you calculate the IDR based on the actual amount *distributed* to unit holders, which is the $23.1 million divided by 37 million units (which includes the subordinated units), or the 0.625/unit -- as the prospectus clearly states -- the numbers don't make any sense, as you've noted.

    BUT if you do the calculations based on distributable cash flow -- $32.3 million or $0.87/unit -- then it adds up perfectly, with $40.1 million gross DCF, $7.8 million IDR, and $32.3 million for us.

    The difference is broken down further in the quarterly report, where they break out the "Assumed allocation of undistributed net income attributable to the Partnership." The actual distribution as per the IDR is $695,000 and the rest is "assumed distributable" cash flow. If you look again at the line where that $7.791 million is reported, it doesn't actually say that it was *paid* to the holders of the IDR, only that it is "attributable" to them.

    But it is a good question to ask -- is that +$6 million difference actually still on the books at HCLP like the other retained, undistributed cash, or is it still getting sent to the GP?

  • not_totally_gray by not_totally_gray Nov 6, 2014 11:50 AM Flag

    http://www.bloomberg.com/news/2014-11-05/saudi-flexing-met-with-crickets-by-u-s-shale-frackers.html

  • Reply to

    Holders of Incentive Distribution Rights

    by dearbear6 Nov 5, 2014 12:41 PM
    not_totally_gray not_totally_gray Nov 5, 2014 3:01 PM Flag

    the IDRs are paid to the general partner(s). it has nothing to do with the common units or subordinated common units or the number of units. typically the incentive distribution is a % of the total distribution above a certain threshold, so it would only be reported as a gross amount such as the $7.791 million. I don't have the numbers in front of me but a typical % from here on would be 50% of each additional dollar would be paid directly to the GP.
    The threshold levels and IDR % would be spelled out clearly in the prospectus from the IPO. I don't have that in front of me but you should be able to find it easily enough from the HCLP website.

  • Reply to

    Here's the call

    by bobdbus Nov 4, 2014 10:34 AM
    not_totally_gray not_totally_gray Nov 5, 2014 12:53 PM Flag

    "- Leverage is higher than they want, 3.7-3.8 adjusted EBITDA, want 3.0. "Have some work to do". [aside from raising equity, how?]"

    The obvious answer is asset sales.

    Seemed like a positive, moving-forward report, which is good, but still not pulling the trigger on the common units yet. Did buy some preferreds this morning -- almost 8.5% yield, selling below par, and cumulative, seems like a very good risk/reward ratio. If they plan on deleveraging by (possibly) selling assets, that directly benefits the preferred shareholders at the expense of the common. All they need to do to make preferred divs is keep the lights on vs the thin coverage of the common distribution.
    Much more inclined to consider buying the common units than this summer, but I have a feeling we'll get a better buying op next month. IMO this and other similar companies will be at the front of the line for tax-loss selling and will be looking for $22-ish.

  • not_totally_gray not_totally_gray Nov 5, 2014 11:20 AM Flag

    when you come right down to it, most investments don't make a lot of sense in a retirement account, in the sense that most investment income is tax-advantaged one way or another, whether it's qualified divs, MLP tax--deferral, LT cap gains rate, muni bond interest, etc. and you give that up. But unless you want to hold 100% corporate bonds + REITs, you have to buy *something* with those funds.

  • not_totally_gray not_totally_gray Nov 4, 2014 10:50 AM Flag

    "Forget about HCLP "earnings""

    But nothing wrong with earnings either -- even the GAAP numbers look good. It just confirms how solid the underlying cash flow is.

  • not_totally_gray not_totally_gray Nov 4, 2014 8:43 AM Flag

    I'm sure it will sell off... IMO yesterday afternoon we saw the beginning of the "sell the news" sell-off. Plus oil prices are in the crapper again this morning with the Saudi price cuts.

    Which isn't to say that the numbers aren't great. If they've already contracted for 6.6 million tons of sand for next year, that's almost 60% greater than the 1.09 million tons they delivered last quarter (plus they had some spot sales to get to the 1.2 million tons.

  • Reply to

    I am getting annoyed...

    by not_totally_gray Oct 27, 2014 1:13 PM
    not_totally_gray not_totally_gray Oct 28, 2014 10:55 AM Flag

    you have to make some allowance for the fact that these are still fairly small companies in terms of float -- obviously lots of professional traders and hedge funds trade the sand stocks as a high-beta proxy for short-term energy trades, so the HCLP volatility is regrettably high. But still.
    " if our coverage ratio is too high"
    looks like mgmt is making good use of the retained cash flow to expand capacity, so no complaints here. much cheaper way to fund growth than issuing even more new shares.

  • not_totally_gray by not_totally_gray Oct 27, 2014 1:13 PM Flag

    ... at this constant deal where whenever there's bad news about EMES, HCLP sells off more.

  • Reply to

    Haliburton & Baker Highes buying more sand

    by gben1938 Oct 21, 2014 9:21 PM
    not_totally_gray not_totally_gray Oct 22, 2014 11:45 PM Flag

    I'm really comfortable... since this correction began, we've gotten new contracts, another quite large div increase, and a decisive bounce off what looked like a panic low. obviously the volatility has been extreme so who knows if it will bounce $5 or more in either direction tomorrow or next... if you don't have a position already, IMO this is a great time to start accumulating... if you've already got a stake, I'd either throw out a buy order for $45 and let it sit there and see if you get hit in another downdraft, or else sell some puts and get paid for the volatility.

  • Reply to

    Haliburton & Baker Highes buying more sand

    by gben1938 Oct 21, 2014 9:21 PM
    not_totally_gray not_totally_gray Oct 22, 2014 5:25 PM Flag

    This is the info I wanted:

    http://blogs.wsj.com/corporate-intelligence/2014/04/30/fracking-sends-sand-sales-soaring/

    So looks like the cost of the sand for a fracked well might run between $150,000 and $300,000, more or less. Given that a typical fracked well costs between $5 million and $10 million, the sand is still a small portion of the overall project. So plenty of room for increased volume and unit price, especially if production is enhanced with more sand volume.

  • Reply to

    Haliburton & Baker Highes buying more sand

    by gben1938 Oct 21, 2014 9:21 PM
    not_totally_gray not_totally_gray Oct 22, 2014 2:29 PM Flag

    Here's the info I was looking for:
    http://blogs.wsj.com/corporate-intelligence/2014/04/30/fracking-sends-sand-sales-soaring/

    So the sand for a "typical" fracked well might cost between $150,000 and $300,000 -- which is still a small fraction (5% or so) of the total well cost, which is typically $5 - 10 million. So if more sand increases the well performance, that's still a slam-dunk economically.

  • Reply to

    Haliburton & Baker Highes buying more sand

    by gben1938 Oct 21, 2014 9:21 PM
    not_totally_gray not_totally_gray Oct 22, 2014 10:08 AM Flag

    "Companies are pumping in as much as a trainload of frac sand into a single well to coax more oil and gas from shale rocks."
    Anyone know about how many tons of sand per well these companies use??

PBCT
15.25+0.02(+0.13%)Dec 26 4:00 PMEST

Trending Tickers

i
Trending Tickers features significant U.S. stocks showing the most dramatic increase in user interest in Yahoo Finance in the previous hour over historic norms. The list is limited to those equities which trade at least 100,000 shares on an average day and have a market cap of more than $300 million.
Virgin America Inc.
NASDAQFri, Dec 26, 2014 4:00 PM EST
Ocwen Financial Corp.
NYSEFri, Dec 26, 2014 4:03 PM EST