This guy is a short. Dont listen. He is totally wrong. You can think of KMI as a Utility company, As we all know Utility companies carry lots of debt but their cash flow carries them thru. So, like a Utility they pay the debt and dividends with strong cash flow. Richard Kinder knows the model and has put his money where his mouth is.Also, short interest is about 52 million shares with 3.2days to cover.
They will cover soon.
Other part is T.B Boone predicts oil at over $70 by Dec. So relax and enjoy the dividends.
Dont panic. Just develop a strategy to trade. Put it in a spreadsheet when to sell.
Here is what I did:
From 2013-2015(June) this is what happened.
My profit was reduced from $4313 to $2643 with my selling today. Still very profiable.
Next I will buy when a bottom is formed in a week.
This is warmed over dribble from last year. They have not proved that the dividend is unsustainble. You would need to study the DCF in more depth. Their logic is flawed. KMI is complex business but steady cash flow business.
Never make a decision with one sided data. Read this article for a more objective view.
Over the past month or so, Kinder Morgan (NYSE:KMI) has declined around 10% or so. The stock is now trading for below $40 per share for the first time in quite a while. This drop is partly due to the move higher in interest rates, with the 10-year rising to above 2.40%, an 8 month high. However, something else is in play, namely a slew of bearish articles from the likes of Barron's and friends.
I guess you dont remember 2008 financial crisis. Many stocks have had their NAV also cut in half.
Meanwhile people that bought 10 years ago collected $14.6 but lost only $7 on NAV. Thats 50% return over 1 years or 5% per year close to the S&P.
Below is the 2014 Index
I got the new 30 funds from Fidelity. Just go under Research and search for CEFL.
Some of these funds are trading near 52 week highs others near the 52 week low.
The main reason that CEFL is down is related to interest rate risk. However, David Rosenberg
a noted chief investnebt adviser says he believes the Fed will not increase rates in 2015. The
reason is the strong dollar will make the world economy worse.
So, I would say buy on the dips, the party is far from over.
Sentiment: Strong Buy
Thanks for pointing that out. I used Prof, Brofmans list from November which has 30. However, it changes the lack of energy exposure. Also, I have analyzed market price and NAV for the last 5 years and put them in a spread sheet. Many of the funds dropped in market price over the last 5years. However, since CEFL is just got listed Dec 13, I will track it over time.
Well stated. Thanks for that review. I think the Professor should analyze it for 25-50 bs increase. Like you I think the dividends will not be impacted significantly. I would expect growth next year to mute the effect of higher rates.
I have reviewed all 30 High Yield Funds in CEFL. They have Stock Index and Bond Index funds. The Stock Index Funds have some XOM CVR but a very small percentage.
The only issue they have is interest rate risk. I believe credit is very low. However, the financial analyst have painted all high yield funds as dangerous. This is creating a buying opportunity.
Sentiment: Strong Buy
You are correct. I am guessing that Cisco, Juniper, F5 might be in the 5. However AMD and Intel also compete in that space. Right now I think the stock is expensive.
Also, IBM had a network processor designed in at Cisco but business never followed. Thats why I am not buying Sy's "design win" sales pitch. The main 5 evaluate everybody with new architetcure so design win does not guarantee biz.
I am thinking of buying but I would like to do more research.
I read there 10Q and it looks like they are dependent on 5 key customers. Does anyone have any idea who these customers are? Network Processors are a volatile product and Intel, Netronome and others are in the same space. It seems to me Cisco might be one there key customers. Any thoughts?
It looks like the shorts are at it again(short interst up 56%). Dont sell. PBA has no commodity price exposure. However, their customers have commodity exposure. If Oil goes to under $70, the NGL liquid margins would go down affecting their customers margins. I am not sure how this would effect PBA earnings since they are fee for service and long term contracts. So there is the risk!!
Its looks like the PBA stock is trading below Pembina Canada by $8. Same company
but different investors. It seems US Stocks get pushed around by shorts and other WS
crooks. My advise is dont sell nothing has changed with fundamentals.