You can at other MLPS (before the oil price crash) and they generally appreciated 5-10% a year in price (again a broad stroke) and then add in the pct of distribution (5-10%). Several things to keep in mind, if/when GRH goes MLP it will get a good pop (look back a year when it was announced) and it has been hammered in general with the market and their struggle to get all the parts working. I am not talking about limited upside from 88 cents.
Because MLPs are classified as partnerships, they avoid corporate income tax at both state and federal levels. Additionally, limited partners may also record a pro-rated share of the MLP's depreciation on their own tax forms to reduce liability.
So the first thing is that we (partners) now receive a distribution and for tax purposes, not all of that distributon is taxable (the feds get their pound of flesh on the back end when we sell our shares - whatever is not taxed lowers our stock basis by that amount). The company can lower their cost of business so they are better able to make deals/buy other assets. It also slows down the possibility of stock price appreciation as most of the profits are passed along and not added to the companies value.
Nicely done - appreciate your ability to "milk" a slow market in regards to NRF/NSAM. Never knowing when and for how long I will be able to be at a monitor any given day, I stick to the options but still appreciate the forward guidance/insights. Did very nicely on NSAM last week and bought ITM April and June calls on NRF on Tuesday. Already up .25 to .30. Not as liquid as the stock but if they keep issuing shares might get more so lol.
I guess the bet is how quickly does the price recover - I have buys in for April and June $17 calls but hard to figure out how much the divi is factored in. If it bounces 50 cents by the end of tomorrow, good buy .....unless it drops farther than that on the 5th. Of course, that is all about "flipping" mode. I believe 100% that the price will be higher than this in December so buying long term is a no brainer over a few cents.
It is the sale/buy after the buy/sale that is the gotcha - you will get a warning message that you are using "unsettled" funds to make a purchase and if you then do something with that purchase before the next 3 day waiting period you could be in "trouble".
I have Mar. 20th $20 calls at IB with a sell in today for $4.20. The price got to $24.16 - so basically 3 weeks wasn't worth 4 cents of vig.
Yes, the thinly traded stocks ITM options always ridiculous. Have had MLP options on the runup to divi (before this crash lol) that I had to take a nickel loss because not enough money to take possession ( 60-100 options on a 40-70 dollar stock was a little heavy). Should have taken the time to see if opted to convert and then immediately sell if they would have let me. Is there a 3-day wait to take possession after exercising?
Same as with every company - one time charges, tax impairments, debt buy back, etc. GAAP vs non-GAAAP. The write off (write down?) of the 3 rigs ($1.47) put out to pasture was a paper loss so I would say .90 is a good indicator.
I got some Mar. 20's a few weeks ago for 1.65 - now 2.40/2.90. Thanks. Would selling NRF covered calls going into earnings be reasonable or chance of getting called if no SO too great?
My assumption (and I may hear from Mr. IRS to the contrary lol) is that as long as your total UBTI is under $1000 (look in box Box 20V don't have to file anything. Even if it is a self directed IRA (as mine is with Scottrade) they are still responsible for the tax and would deduct it from your account.
The term is UBTI - “unrelated business income tax” (UBIT). Under the UBIT rules, tax-exempt organizations and retirement accounts must pay tax on their “unrelated business taxable income” (UBTI). It is not the same as the distribution and is a life-time amount in the IRA. The K-1 (not 1099) for the IRA will have the info. Different MLPs generate different pct. of UBTI depending on their business model. The $1000 deductible is per year (but I have seen it stated as life time total) and you will have to own lots of shares and/or have the MLP generate a lot of UBTI to be hit with this tax. To make things more interesting, you do not actually owe the tax, the IRA administrator does! It comes out of your account and goes to the IRA.
Geez, a touch pad is a dangerous thing to use while reclining on the couch. The reason I referenced the REITS is they continually make secondary offerings and do so at a price 3-5% below the current price of the stock. The share price will almost always open below that offering price and stay there for a while. .
As someone who has owned (and owns) dozens of REITS and MLPs (not proud to admit that in today's market lol) I am blown away that more has not been of what has happened this week. NVIV basically had a secondary of ~10% of the float at $1.50 and the price has remained rock steady at $1.90 in the face of 2 almost 300 point down days in the market. The entity that bought the shares seems to have kept most of them (looking at the volume anyway) and possibly the early morning spikes down on Wed. and Thur. were some of those shares. Unless the 2nd patient dies as a direct result of the implant, I don't see anyone getting a chance to load up at $1.50.