Thanks, michaelmcmx, I certainly know about Brazil, but didn't know about change in government in Spain - this adds up to the worrisome picture. I think I'll go to wait-n-see mode. Even the divvy isn't safe any more, I surmise. Hopefully, I am wrong.
parmaatma, thanks for sharing your outlook. So, you see SAN being in a survival mode, and market agrees. Do you have numbers/projection of SAN's fair value given current conditions?
But graveyards are real estate, essentially, aren't they? If so, it's not a regulated monopoly, so there are competitors. I understand the business is very conservative by nature, still being leveraged 10 times ps a lot of risk as far as I understand.
STON looks very attractive at these levels, and I was ready to shoot, but looked at the leverage: EBITDA/Total DEBT (less cash) ~ x10. This is a huge leverage even for an mlp (and I just got burned by KMI). Am I missing something???
I agree. BIP has a safer revenue stream than many MLPs as it operates in a regulated or "natural" monopoly fields (ports, toll roads, electric power lines). But it's heavy exposure to ailing Brazil and stagnated Australia makes it a somewhat riskier investment. Also, plans to buy a stake in an Australian port raised investors' concerns. I am a long-term stock holder and plan to add to my position at these prices. I feel we may see low 30-s pretty soon.
By the way, the timber business was sold some time ago.
Good luck to longs!
Two growth related news in a day, good. As for price movements I am not so optimistic as the whole energy sector continues to tumble. BUT - I am much less concerned with the unit price than with the business health (hence the distribution).
Funny, I asked a fundamentals question, one person liked it (the question), and one disliked, but nobody tries to answer. Is everyone so preoccupied with the share price moves that doesn't care about reasons behind?..
I still hope that there are people on this board who (unlike me) do the DD on this stock and would be willing to share. Based on the numbers (EPS, P/B, P/S etc.) the stock looks good with the exception of high debt level (D/E smth like 2.5) - and this makes me cautious. If I was confident in the basic fundamentals of this stock I'd be a buyer at these levels.
Hello, I need some enlightenment from the board. I've been holding a small position in SAN for some years, and (my fault!) wasn't paying much attention. I just took a quick look at the numbers. and SAN appears quite undervalued based on earnings projections and current price. The only problem I can see is quite big debt load. Are there real operational problems for this bank?
Thanks in advance!
bc4golf, div cut still may happen in future, but based only on the operations results, not on the current price moves. The price has jumped from below $4 to over $8 in a matter of days, and this is 100%+, so the pullback was totally in order. At this time we don't know how much (if any) of this up-volume was bought by Arc, and how much - by the market. In any event it shall be attributed to the Arc's display of confidence in AMID's future. As for the future, we will know the results of operations in this quarter sometime in Feb(?). If things go well, like expected, there shall be no cut. If things go south, then, yes, they may cut.
Good news, and comes on the heels of hiring Bourdon as CEO, both steps show ArcLights's commitment to AMID as a long-term story. I am just wondering if the share purchase can be also interpreted as a step towards taking it private?
I wonder if anybody tried to contact the IR in Denver and pose these questions? I've been thinking of doing that, but always feel uneasy talking on the phone.
lucius.rodin, I talk reality, but I don't enjoy talking to those who engage in casual rudeness. Good buy. P.S. Hope you get a chance to sell your units at a profit.
Because I think it's a matter of survival: the downward spiral we are seeing is a result of investors' fears of losing capital, i.e. bankruptcy. AMID's debt is much higher than its cash flow, and this kind of loss of market value we are witnessing means the debt become unmanageable. I am not saying they WILL take it private, but I think this option is on the table. Another option may be infusion of preferred capital and cutting distribution on common units. But they HAVE TO do something to alleviate bankruptcy fears.
He was one of the top guns in EPD (which is one of the best managed MLPs) for a long time, well known in the field. I think this shows ArcLight'scommitment to AMID as a long term story. But, alas, this doesn't preclude them from taking AMID private (which I believe is the option in a serious consideration right now).
Exactly, the market! Depth of deterioration makes the firm barely viable. My guess it will be restructured or taken private. This being said, I've just added a little to my position - couldn't resist the price.
Sign of distress is in huge debt compared to earnings (~x9.5) and falling market value which translates into shrinking credit lines with banks.
Sign of distress is in the huge div yield and a falling unit price, which suggests "market" knows something we don't. No one in his right mind sells a stock yielding 38%.
Div. Yield is approaching 40%, and this is a sure sign of huge distress. This kind of price action has always been a foreteller of a drastic dividend cut or div. elimination. Just like you I am trying to figure out why, and the best I can see is AMID being overleveraged: look at TTM EBITDA/Total Debt ratio - it is about 9.5,, way too much. They need to rollover debt, and their access to capital diminishes when pps goes down this much. I know, they forecast leverage to be near 4.5 in a year, but this yet needs to materialize, they really need to make the kind of profits they anticipated at the time of las CC. But... with the oil/gas prices falling there is a counterparty risk, i.e. some of the clients may just stop pumping and refuse to renew contracts or even keel over. One more question is about the semisubmersible platform they just acquired as a result of the drop down: is it gonna be profitable at all at current or lower commodity prices?
All this are valid concerns in my view. Plus the market sentiment.
Clearly we don't know something that market already knows! There wouldn't be this kind of price action otherwise. I am tempted to try to contact investor relationships (never done this before).