daily volume has been extremely high the last 2 sessions and if today's volume is high it's not a big stretch to think that a lot of the short positions are being bought back. The most current reporting shows the short position roughly at 9 1/4% of the float. But we have seen this before, as the intraday high last year peaked on February 24 at 36.22 and we all know how last year turned out.
With having read in the last 10 Q that USG management is not confident that they can hold a price increase this year, I sure hope that GS analyst is correct in implying that his numbers might be conservative.
It would be nice if the share price could at least break through last years intraday high and hold it for the year.
Not only did GS reiterate a buy rating on USG and AWI but analyst Eli Hackel said:
"We have also done several distributor checks which have indicated that business does seem to be improving, with backlogs continuing to pick up. We believe that volumes could be in the mid-single to high-single digits in 2015 after barely growing since the recession. Given that investors have indicated they have been disappointed with the recovery so far, we think they could be in wait-and-see mode. However, we would be buying the exposed names," continued the analyst.
"Several distributor checks indicate that pricing could be up similar to last year, which we think is above expectations. It takes several weeks into the year to have a good understanding of where pricing is settling out, but we believe, overall, we could see pricing up around double digits, with USG perhaps slightly slower given high big-box exposure. We are currently modeling only 6% for USG, so, given these checks, we now believe this number could prove conservative," he added.
Maybe today's high volume indicates some short covering. Anyway, hope 2015 turns into a great year for USG.. GLA
Ignorance is bliss I see. I am a retired Geologist and I own the oil leases on 2- 5k acres tracts in Montana so yes, I know the industry. I get paid per barrel but also on all refined finished goods. I have the same major driller on both my leases and they pay for the transport.
I will try to explain so maybe you can understand without all the name calling (very immature). It's really simple to understand but lower priced oil does make the cost of transport by rail too expensive. The driller cannot pay the same transport cost as if he was getting $80bb when he now gets $65bb. They have to cut expenses or go broke. The alternative is to increase at the pipe and seek concessions from both pipe and rail.
Pipe will see higher volumes but at a reduced structure. No one knows how long oil will stay below $70 so this uncertainty creates panic selling. SHLX in particular is one you want own imo regardless of where oil is priced.. GL
DUH!!! Captain Obvious.. Of course they have a minimum, they could not state the following: "Upon the consummation of this offering, our partnership agreement will provide for a minimum quarterly distribution of $0.1625 per unit for each whole quarter, or $0.6500 per unit on an annualized basis. "
All MLP's have a guaranteed volume minimum. You are new to investing now I understand. GL
You really need an education. Quit guessing and being so frustrated. Just go to the SEC website and find the SHLX prospectus and read..Unbelievable people buy units and or shares of companies blind. GL
When the merger talks were underway in 2004 it was relevant and made a lot of sense for both companies. Today it is a dumb idea. The new CEO will not take on such an overwhelming task. He has been selling assets wherever he can in order to get back to basics and cut expenses. The last thing he wants is to have any more exposure to Russia.
If your former Shell alumni really thinks this is relevant he should reconnect with current voices within.
Right now it's best to be invested in the pipelines/refiners in my opinion, while the rest scale their business accordingly.
Yes, it is hard to believe. Just a rumor regurgitated from 2004. So why would Shell want more exposure to Russian oil? Not to mention the legal issues BP has not resolved. Dumb idea and I bet the majority of Shell stockholders would not approve it.
bb, of course the price of oil has an effect on pipeline volumes. The problem is this: Lower priced oil eventually makes the transport by rail too expensive for the drillers, so pipelines will see an increase in volume but the flip side is that the drillers will demand a cut in price from the pipeline companies. So how low before the concessions start? Hard to get an accurate handle on so a panic sell is created. Just have patience as you will see SHLX a lot higher once drop downs start in a few months.
This latest selloff is way overdone but might not be over yet. The issue everyone should be raising is why allow OPEC to short oil before such a critical meeting? Talk about manipulation..
Well done.. but I believe you own units and not shares.. I bought several thousand units of PSXP at 29 and change and am still holding. Bought a similar position in SHLX in the 31.75 range and will hold. Anxious for the first CC..
Again, if you would read the prospectus the divi has been defined as follows: Until SHLX announces a change this is relevant: "Upon the consummation of this offering, our partnership agreement will provide for a minimum quarterly distribution of $0.1625 per unit for each whole quarter, or $0.6500 per unit on an annualized basis. "
As far as PE is concerned, it's totally irrelevant short term. The first year at the least, SHLX will be viewed as a growth company so to try and value this with traditional metrics is nonsense. What to expect going forward: after the quarterly announcement, watch for the first drop down (sometime first quarter 2015) followed by the Alerian MLP ETF announcing the placement of SHLX into their portfolio. Both of the events will boost the unit price exponentially. Have patience, it would not surprise me to see the unit price in the 70's by next summer. GL
You guys should read the prospectus.
Until SHLX announces a change this is relevant: "Upon the consummation of this offering, our partnership agreement will provide for a minimum quarterly distribution of $0.1625 per unit for each whole quarter, or $0.6500 per unit on an annualized basis. "
Also low oil prices will increase consumption which means more volume for the midstream segment. PSXP and SHLX are looking good.. GLA
Hopefully, we have the first dropdown sometime in the next quarter. Then by summer of 2015 will be the add to the Alerian MLP ETF..
PSXP stated in their last cc they will do $1-$2 billion a year in drop downs for several more years to achieve their targeted 20%+ growth yearly. I expect SHLX to at least be in this target range and may possibly be much more. Upcoming guidance from management will give us a clear picture. GLA