I have owned natty tanker forever. Added NAO just recently. Both are backed by very strong balance sheets. They run a simple clean plan. Well capitalized low cost efficient producer. I do not know what the market holds but I do believe these guys will be the last man standing no matter what. Everyone's time frame is different, mine is decades. I like to buy companies I can hold and not worry about. In this general space I own FGP, MMLP and NAT and just recently added NAO. My cost basis on the first three is way less than zero after distributions. I believe 10-20 years from now psv's will be around and so will nao and the 9 bucks I paid for it will be back in my pocket. That is a long winded way of saying relax.
I am not sure what Greece issues have to do with this company. The ships are registered in the Marshall Islands. Greece has no jurisdiction over them.
this is not overweight drillers nor is it all pipelines. In the top ten holdings is 3 shippers, 2 nat gas compression companies, 1 propane distribution company, 1 onshore driller/midstream company. 1 offshore driller, one refiner and one coal producer
Just my 2 cents: everything energy related has obviously gotten creamed. However if you analyze the holdings of YMLP you will find many companies that are not as sensitive to oil price as others in the space. For example the shipping companies (TOO,NMM) are more correlated to movement and availability than to the price of crude. Further the nat gas compression companies (CCLP,USAC) are more correlated to use than to price. Next the refiners (CLMT) actually do better when crude is lower. Last the nat gas exporters (Glop, GMLP) also should do better with prices lower.
Having said that energy is an easy short, so it goes. Also with the fed telegraphing a rate hike the mlp etfs are going to take a hit, it is a very crowded space.
Last quarter I did a spreadsheet to figure out what they would pay in distributions and I got pretty close. I have not done one for this quarter but I do believe they will be right at 35 cents. So I am holding. I am not reinvesting my divs. I plan on waiting until the fed makes their first move and the dust settles.
Made initial purchase at 5.62. Told myself will not add till earnings are out. I really want to pull the trigger again though. 3.85 per share cash on the balance sheet. Leaves the business valued at 77 cents. Price to sales is .33.
I have gone over the financials of UAN and they seem straight forward and rock solid. Very few LP's generate positive levered free cash flow. These guys do. I understand the single site risk is especially high considering they could blow up the whole town on a real bad day.
Further their rolling average distribution had been going south until last Aug. But it is still very strong.
Given the squeaky clean balance sheet and a nominal pay out of 40 cents, this should be trading way closer to 20 than 10.
So what am I missing?
Been gone for a while. Looks like nothing has changed much. When we hired our new hero we should have checked to see if he could actually speak. Only news we have got wind of is all the high priced people they are hiring. Guess GF got tired of wandering around the top floor alone.
As an aside does anyone know what slick nick is up to nowadays?
I am not sure I see your point. I bought Line originally around 15.5 many years ago. I have swapped to lnco and back at least twice, maybe three times. Never a home run but several hundred dollars each time. I have received a little over 17 bucks in dist/divs plus a few thousand dollars in "swap" money. If line never goes above lnco again my swapping days are over. I guess my question is what is the real difference between these two. I know and understand the mechanical side i.e. partnership vs. common, IRA implications ect.. Beyond that what?
I have several times swapped between LNCO and Line when the price differential has swapped. I picked up 3% today selling LNCO and buying Line. I own 2000 shares it seemed like US$600 free money to me. What might I be missing?
Hey so far the statement, "off shore is dead profit wise for sometime." as it relates to SDRL is opinion or goofy, or both. They killed it last quarter.
Ok 4.8 billion in debt. Half billion is payables covered by 3/4 billion in AR.
Long term debt is 4.3 billion. Interest on that is 300 million. Depreciation is roughly
370 million. EBITDA was 1 billion and operating cash flow is .5 billion.
By any measure this is not a distressed situation.
I do not think I missed any point. I asked a question about the death of off shore. If they can not drill profitably then it is dead. I just do not believe in that particular premise.
Further I do not believe in demand deceleration. Hey I could be "dead" wrong, but macro econ 101 says lower price drives demand up. Demand goes up supply goes down. Supply goes down prices go up. Prices go up over investment transpires. Over investment transpires prices collapse. That is why they call this a cyclical business.
It could be different this time, but I for one doubt it.
To me, at issue is how long this all takes to play out. It will not be a question of months but rather years. The big question in my mind is,"If I buy sdrl at 10 now will it double in three years?" Or will their balance sheet implode first? Not an easy one!
I do know this, the business is selling at .5 book. So by any measure it is cheap. This is certainly not the time to be selling. But that does not make it a screaming buy either.
I guess for awhile I will remain a deer in the head lights.