M&A Levels in Oil & Gas MLP Sector "Very Strong": Exclusive Interview with Robert W. Baird & Co.'s Senior Analyst Covering Master Limited Partnerships and U.S. Royalty Trusts

Wall Street Transcript

67 WALL STREET, New York - March 27, 2013 - The Wall Street Transcript has just published its Oil & Gas: Master Limited Partnerships Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Increasing Demand for Midstream Assets - U.S. Energy Infrastructure Build Out - Emerging Shale Plays - Oil and Gas Transportation Infrastructure Demand - Master Limited Partnerships Distribution Growth - Outlook for Natural Gas Liquids - Low Treasury Yields and MLP Dividends

Companies include: Energy Transfer Partners L.P. (ETP), Kinder Morgan Energy Partners (KMP), El Paso Pipeline Partners, L.P (EPB), Copano Energy LLC (CPNO), Sunoco Logistics Partners LP (SXL), Enterprise Products Partners L (EPD), EV Energy Partners LP (EVEP), Linn Energy, LLC (LINE), Atlas Pipeline Partners LP (APL), Plains All American Pipeline L (PAA), Dow Chemical Co. (DOW), Targa Resources Partners LP (NGLS)

In the following excerpt from the Oil & Gas: Master Limited Partnerships Report, an expert analyst discusses the outlook for the sector for investors:

TWST: What were the key themes or trends from the most recent quarterly reports?

Mr. Bellamy: We're in the middle of earnings season right now, and I would describe the trends broadly as follows: First, MLPs have extraordinary access to capital, and that, coupled with an extraordinary secular growth opportunity - which is generational - if you take into account both upstream and midstream in North America, amounts to trillions of dollars of capital that can be deployed over the next few decades, thought about most broadly, of course. Really, the sky is the limit for the MLP sector in terms of secular growth. Now, clearly investors are going to be more focused on how they get paid for being invested in the sector, which is why we think short-term tactics and entry points are important to pay attention to. But for an investor with a five-year-plus time horizon, deploying capital in this sector, I think, is a very good bet.

There are continued new product developments. Institutionalization of the MLP sector continues to be very solid, with new mutual funds, new ETFs, new open-ended funds. That institutionalization of the sector is likely going to continue to drive yields lower towards REITs and utilities; there's still a fairly strong spread between MLP yields and those two comparable asset classes.

So I think very long term, there is positive secular growth opportunity ahead of us. I think investors should pay attention. Despite the fact that MLPs have been around for a while and a lot of people have made money on them, there are still a lot of investors who don't own any MLPs, or have exposure to the group indirectly. I think that there's still strong potential for the group to benefit just from positive fund flows.

TWST: What's the status of M&A activity?

Mr. Bellamy: M&A levels are very strong. We've seen a recent trend of crude rail logistics acquisitions in North Dakota. We've seen corporate-level M&A from Energy Transfer (ETE) and Kinder Morgan (KMP)...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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