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Prior Updates May 06 Apr 06 Mar 06 Feb 06 Jan 06 2005 Updates Dec Nov Oct Sept Aug July Jun May Aprl Mar Feb Jan 2004 Updates Dec Nov Oct Sept Aug July Jun May Intro MLP & Energy News Oil Online MLP Blog Petro News Util/MLP Blog Yahoo News MLP Intro Wachovia Primer R James Primer Alerian Primer Market Stats MLPs at Yahoo MLPs at CNN MLPs at Excite MarketWatch MLPs at MSN MLPs at WSJ Factoids June May April March February January REIT Updates April Off/Ind/Apt April Retail/Hlth Bank Updates April March February January |
The spreadsheet below uses month ending data. The 'monthly change' column is for unit price changes, while the 'year to date' stats is for total return [distribution plus unit price gains]. This explains the jumps is year to date gains in the distribution heavy months of February and May without similar gains in those month's unit price gains.
The Importance of Distribution/DCF Ratios: It is logical that MLPs that keep more of their distributable cash flows should, due to reinvestment of more self-generating cash, grow their unit price faster than those that keep less. The following companies had Distribution/DCF ratios of less than 81.31% [the sector average at the begining of the year] : APL, BPL, BWP, CPNO, ETP, HEP, HLND, MWE, PPX, TLP, WPZ, XTEX, and MMLP. Their mean price gain for the year is 11.39%. Their mean total return for the year is 14.63% - and 8 of the 13 beat the sector average yearly price gain [6.73%]. The following companies had Distribution/DCF ratios of more than the sector average of 81.31% : EEP, EPD, KMP, MMP, OKS, PAA, SXL, TCLP, TPP, VLI, KSP, TGP, and USS. Their mean price gain for the year is 2.08%. Their mean total return for the year is 5.66% - and 2 of the 13 beat the sector average yearly price gain. The two MLPs in this group that beat the sector average gain [OKS and PAA] both had large estimate increases since the begining of the year, changing their ratio for the better. The Importance of Ratings: Can analysts pick between the MLP winners and the fully valued? Below I track the stats on that theory that the higher rated stocks will outperform the lower rated ones. The following companies were the highest rated MLPs - those that had ratings of less than 2.25 [the sector average at the begining of the year] : APL, BWP, EPD, ETP, HLND, MMP, MWE, PAA, PPX, XTEX, TGP, and USS. Their mean price gain for the year is 9.61%. Their mean total return for the year is 12.98% - and 6 of the 12 beat the sector average yearly price gain. The following companies had ratings of more than the sector average of 2.25% : BPL, CPNO, EEP, HEP, KMP, OKS, SXL, TCLP, TLP, TPP, VLI, WPZ, KSP, and MMLP . Their mean price gain for the year is 4.27%. Their mean total return for the year is 7.71% - and 4 of the 14 beat the sector average yearly price gain. The Importance of Ratings Part Two: Given that the analysts picks will fall on a bell curve - spliting their MLP picks into only two groups puts similarly rated stocks [the majority that fall in the middle] into two different camps - and this could muddle the results. Below I track the stats on whether the highest rated stocks did outperform. The following companies were the highest rated MLPs - those that had ratings of less than 2.0 : APL, EPD, ETP, MMP, PAA, PPX, XTEX, and TGP. Their mean price gain for the year is 9.02%. Their mean total return for the year is 12.44% - and 4 of the 8 beat the sector average yearly price gain. The following companies had ratings of more than 2.0 : BPL, BWP, CPNO, EEP, HEP, HLND, KMP, MWE, OKS, SXL, TCLP, TLP, TPP, VLI, WPZ, KSP, MMLP, and USS. Their mean price gain for the year is 5.71%. Their mean total return for the year is 9.12% - and 6 of the 18 beat the sector average yearly price gain. The Importance of Yield: MLPs with the lowest yield are priced higher [on a price/distribution basis] due to the expectations that they will grow their unit price. Yield is a 'rating' that investors give a stock. Since yield is a bird in the hand and growth is a bird in the bush, growth should sell at a discount - and growth stocks [the low yielders] should have a superior total return. The following companies had yields of less than 6.92% [the sector average at the begining of the year] : BWP, CPNO, ETP, HEP, HLND, KMP, MMP, TLP, VLI, WPZ, XTEX, KSP, and TGP. Their mean price gain for the year is 10.43%. Their mean total return for the year is 13.46% - and 7 of the 13 beat the sector average yearly price gain. The following companies had yields of more than the sector average of 6.92% : APL, BPL, EEP, EPD, MWE, OKS, PAA, PPX, SXL, TCLP, TPP, MMLP, and USS. Their mean price gain for the year is 3.03%. Their mean total return for the year is 6.82% - and 3 of the 13 beat the sector average yearly price gain. The Importance of Price Targets: MLPs which sell at the largest discount to their twelve month price target should - if the analyst are correct - out-return those that sell at a smaller disount to target - right? The following companies had price to target ratios of less 84% [the sector average at the begining of the year] : APL, BWP, EEP, EPD, HEP, HLND, MWE, PAA, PPX, VLI, XTEX, MMLP, and USS. Their mean price gain for the year is 6.49%. Their mean total return for the year is 10.03% - and 6 of the 13 beat the sector average yearly price gain. The following companies had price to target ratios of more than 84% : BPL, CPNO, ETP, KMP, MMP, OKS, SXL, TCLP, TLP, TPP, WPZ, KSP, and TGP. Their mean price gain for the year is 6.97%. Their mean total return for the year is 10.25% - and 4 of the 13 beat the sector average yearly price gain. The Importance of Distribution Increases [Annual]: MLPs which increase their distribution at the fastest pace will out-perform those MLPs that don't - but did they in Q2? The following companies had distribution increases of greater than 10% from Q2-05 to Q2-06 : APL, CPNO, ETP, HEP, HLND, MMP, PAA, PPX, SXL, VLI, XTEX, and MMLP. Their mean price gain for the year is 10.34%. Their mean total return for the year is 13.81% - and 7 of the 12 beat the sector average yearly price gain. Four newbie MLPs paid no distribution in Q2-05. The following companies had distribution increases of less than 10% : BPL, EEP, EPD, KMP, MWE, OKS, TCLP, TPP, KSP, and USS. Their mean price gain for the year is -0.38%. Their mean total return for the year is 3.32% - and 1 of the 10 beat the sector average yearly price gain. High Distribution Increases [in Q2]: MLPs with increasing distributions out-perform, but in this what have you done for me lately world, is short term performance more important? Or are long term trends what matter? The following companies had distribution increases of greater than 3% from Q1-06 to Q2-06 : BWP, CPNO, ETP, HLND, MWE, OKS, SXL, TLP, VLI, WPZ, XTEX, and TGP. Their mean price gain for the year is 12.05%. Their mean total return for the year is 15.12% - and 7 of the 12 beat the sector average yearly price gain [7.24%]. The following companies had distribution increases of less than 3% : APL, BPL, EEP, EPD, HEP, KMP, MMP, PAA, PPX, TCLP, TPP, KSP, MMLP, and USS. Their mean price gain for the year is 2.17%. Their mean total return for the year is 5.87% - and 3 of the 14 beat the sector average yearly price gain. Newbies vs. Old Timers: It is the newer MLPs that have the most favorable GP splits - but is that important? Or are there other attributes that give the veteran MLPs an advantage? The following companies had no yet to begin distributions in Q1-04 [the newer MLPs] : BWP, CPNO, HEP, HLND, TLP, WPZ, KSP, TGP, and USS. Their mean price gain for the year is 10.72%. Their mean total return for the year is 13.74% - and 5 of the 9 beat the sector average yearly price gain. The following companies are the veteran MLPs : APL, BPL, EEP, EPD, ETP, KMP, MMP, MWE, OKS, PAA, PPX, SXL, TCLP, TPP, VLI, XTEX, and MMLP. Their mean price gain for the year is 4.62%. Their mean total return for the year is 8.24% - and 5 of the 17 beat the sector average yearly price gain. High Gas Storage Levels Threaten Prices of Gas & Coal Gas Processors Report 6-07 North American natural gas storage facilities may fill to the brim this autumn, causing prices to drop and thereby threaten the financial viability of old coal-fired power generating stations, a Cambridge Energy Associates (CERA) study concluded. "Absent a warmer-than-normal summer or significant gas supply disruptions by hurricanes, CERA expects the October 31 North American gas storage inventory level to reach 4,200 Bcf, a more than 95% fill of expected working gas storage capacity," the Boston-based consulting firm said. "Given end-of-cycle physical limitations on injections, and expected average September and October storage injections approximately equaling injection capability, CERA expects some storage fields, especially in the US East region, will not be able to accommodate additional injections." Insufficient storage will likely force a sharp drop in spot gas prices, and that will in turn cause power generators to switch from coal to gas as Henry Hub prices move closer to $5/mmBtu, CERA Director Ken Yeasting said. "The coal-fired units most likely to be displaced would be older, inefficient eastern coal plants burning high-cost Appalachia coal without emission control equipment, in markets where prices for sulfur dioxide emissions allowances are relatively high," Yeasting added. Provident Files for MLP IPO Gas Processors Report 6-07 Calgary-based Provident Energy Trust filed with the Securities and Exchange Commission last month for one of its subsidiaries to issue an initial public offering for a master limited partnership. Provident will own 96% of the general partner units and more than 65% of the limited partner units. A subsidiary called Breitburn Energy Partners will transfer about half of its proved reserves and two-thirds of its daily production, located in the U.S., to the partnership. Breitburn will retain its remaining California producing properties, located primarily in the West Pico and Orcutt fields, in its own subsidiary. Proceeds will be used to pay debt and to make a distribution of $71.6 million to Provident and Breitburn. Provident owns production in California, Wyoming and western Canada, and has a midstream liquids services and marketing business, which appears to be unaffected by the IPO. Provident owns the Redwater fractionation facility 75 kilometers east of Edmonton, the LGS pipeline, a 565-kilometer gathering system that runs along the border between Alberta and British Columbia and the Younger NGL Extraction Plant in British Columbia. Boardwalk, Energy Transfer and ONEOK Propose Midcontinent Pipeline BusinessWire 6-08 Boardwalk Pipeline Partners, Energy Transfer Partners, and ONEOK Partners announced the signing of a letter of intent regarding the formation of a joint venture that would construct a new interstate pipeline originating in North Central Texas, crossing the states of Oklahoma, Arkansas and terminating in Cohoma County, Mississippi at a new interconnect with Texas Gas Transmission, LLC. The proposed interstate pipeline would have initial capacity of up to 1.0 Bcf per day. Boardwalk, Energy Transfer and ONEOK Partners collectively bring value to the project: Boardwalk with access to numerous markets in the Midwest, Northeast and Southeast through interconnects on Texas Gas and Gulf South; Energy Transfer and ONEOK Partners with extensive intrastate pipelines and gathering assets in Texas and Oklahoma. Combining this broad range of experience is of critical importance given the current competitive marketplace for the development of new interstate pipeline projects. PAA to Acquire PPX PRNewswire 6-10 Plains All American Pipeline announced today that it has executed definitive agreements to acquire Pacific Energy Partners. The total value of the transaction is approximately $2.4 billion, including the assumption of debt and estimated transaction costs, and is expected to close near the end of 2006. Under the terms of the agreements, PAA will acquire from LB Pacific and its affiliates the general partner interest and incentive distribution rights of Pacific Energy as well as 2.6 million common units and 7.8 million subordinated units for a total of $700 million in cash. In addition, PAA will acquire the balance of PPX's equity through a tax-free unit-for-unit merger in which each other unitholder of PPX will receive 0.77 newly issued PAA common units for each PPX common unit. "The PAA executive team see great merit in this combination with PPX. In addition to being a synergistic, accretive and strategic business combination, we view this as a transforming transaction - one that we believe positions PAA for long-term stability and growth," said Greg L. Armstrong, Chairman and CEO of PAA. "From an industrial logic and strategic perspective, it is hard to imagine any two MLPs that fit better together than Plains and Pacific." Armstrong noted that PAA expects to realize near-term synergies of approximately $30 million on an annualized basis, increasing to approximately $55 million over the next few years, and further increasing to over $70 million in the outer years. "Combining our respective businesses will provide meaningful cost reduction and revenue enhancement opportunities as well as complementary vertical integration opportunities. The transaction will allow PAA to extend its proven business model over a broader suite of crude oil assets and operations," said Armstrong. "Based upon the enhanced and extended visibility for continued cash flow growth and accretion provided by this transaction, effective with the first quarterly distribution declared after closing the merger, we intend to recommend to our board an increase in our annualized distribution level to $3.20/unit. This represents an increase of 13% over our current annualized distribution rate of $2.83 per unit. We believe that we will be able to build off of this elevated distribution level and continue to target seven to nine percent annual distribution growth over the next several years," said Armstrong. Based on the 20-day average closing prices of the respective partnerships, PPX unitholders are receiving a market premium of approximately 14.3%. In addition, based on an annualized distribution for Plains All American of $3.20 per unit after the transaction closes, Pacific Energy unitholders will receive an equivalent distribution of $2.464 per unit, which represents an increase in their annualized distribution of 8.5% over the current level of $2.27 per unit. Armstrong noted that Plains All American's general partner, in support of the transaction, agreed to reduce its incentive distributions by $20 million in 2007, $15 million in 2008, $15 million in 2009, $10 million in 2010 and $5 million in 2011, based on a year-end 2006 closing and a simultaneous increase in the annualized distribution to $3.20 per unit. "The profile of these reductions in the general partner's incentive distributions complements the increasing cash flow profile provided by the ramp-up in synergies and growing contributions from internal growth projects that come on-stream over the next five years. PAA's new 2007 net income guidance: low of $2.79/unit and a high of $ $3.00/unit. Calumet Specialty Products Partners, L.P. Announces Public Offering PRNewswire 6-26 Calumet Specialty Products Partners, L.P. (CLMT) announced that it has filed with the Securities and Exchange Commission a registration statement for an underwritten offering by the Partnership of 3,300,000 common units. The Partnership intends to use the net proceeds from the offering to repay all of its borrowings outstanding under its revolving credit facility, fund the construction and other start-up costs of the previously announced expansion project at its Shreveport refinery and, to the extent available, for general partnership purposes. Williams Partners Announces Pricing of 6.6 Million Unit Equity Offering PRNewswire 6-14 Williams Partners L.P. announced today that it has priced its previously announced offering of 6.6 million of its common units at a price of $31.25 per unit. WPZ currently has 14 million shares outstanding. Williams Partners intends to use the net proceeds of the offering to fund a portion of the purchase price for its acquisition of a 25.1% interest in Williams Four Corners LLC. Rapidly Expanding Eagle Rock files for IPO David Givens, Gas Processors Report 6-14 Eagle Rock Energy Partners filed early this month for an initial public offering of a master limited partnership. The company expects to raise $230.8 million from the sale of 12.5 million shares in the fall. Eagle Rock will use the proceeds to replenish $15 million of working capital. Private investors and a holding company will get repaid the $195.8 million they are owed. Eagle Rock is currently a portfolio company of Natural Gas Partners. It's been buying up midstream assets at an increasing rate since it was formed in 2002. Stacy Horn, Eagle Rock commercial vice president, explained in an interview with GPR how the company intends to grow along with expanded Texas natural gas output. Eagle Rock finished in the spring a 10-inch, 23-mile natural gas pipeline to the Indian Springs processing plant in Polk County. It's an interest owner in that plant, operated by Enterprise. The pipeline handles 15 Mmcf/d and gathers gas from new and existing wells in Tyler and Polk Counties. Another 13-mile, 12-inch segment is being built to connect the gathering system in those counties to Eagle Rock's Brookeland plant. The company closed March 31 on the purchase of the Brookeland and Masters Creek gathering and processing systems from Duke Energy Field Services. The Brookeland plant has a throughput of 100 Mmcf/d and liquids production of 2,500 bbl/day. Austin Chalk output is prolific enough to sustain business at both Indian Springs and Brookeland, Horn said. In its IPO filing, the company listed Anadarko Petroleum and Enterprise Products Partners as its main competitors in the area. The company is just as eager to expand in the Texas Panhandle, where its biggest competitors are Enbridge and Duke. Eagle Rock bought $528 million of gathering assets from Oneok in the area in December. The properties specifically included 3,700 miles of gathering lines, and six processing plants with capacity of 150 Mmcf/d and liquids output of 13,500 bbl/day. The system is now being rationalized because of exceptional amounts of horsepower in place that require a lot of fuel. "We want to rationalize physically and grow commercially," Horn said. "Most of our contracts are percent of proceeds contracts, so it makes sense to producers as well as us to grow." The west side of that system has four inactive plants, two of which might be moved and the others salvaged. "We are looking desperately to create east side capacity to accommodate the Granite Wash play," he said. A 10-mile, 12-inch pipeline has been built to connect its east gathering system with the west, where the low-pressure Granite Wash gas is sourced. Eagle Rock is tied into the Oneok and Koch systems for sale of NGLs from the area, and Horn said the company is now looking at new gas markets for its producers. "We want to take advantage of price swings and optionality," he said, "to hook into additional gas markets in the Midcontinent." Energy Transfer Partners, L.P. Announces Special Distribution Businesswire 6-20 Energy Transfer Partners announced that the Board has declared a special distribution of $0.0325/unit related to proceeds received by the Partnership in connection with the SCANA litigation. This distribution will be paid on July 14, 2006 to the holders of record of the Partnership's Common and Class F Units as of the close of business on June 30, 2006, at the same time the previously announced quarterly distribution is paid by the Partnership. MWE to Offer 3 Million Units AP 6-22 MarkWest Energy Partners LP said Friday it will offer up to $200 million in senior notes and 3 million shares of common stock. The notes will have a due date of 2016. The company plans to use proceeds to repay debt. The 3 million shares offered, representing limited partner interests, are worth about $124.9 million. Proceeds will be used to maintain its 2 percent general partner interest and to repay debt. Underwriters will have a 45-day option to purchase an additional 450,000 shares. MarkWest has 12.9 million shares of common stock outstanding. TPP to Offer 5 Million Units Businesswire 6-25 TEPPCO Partners today announced the commencement of a public offering of 5 million units representing limited partner interests. TEPPCO has also granted the underwriters an option to purchase up to an additional 750,000 units if they sell more than 5 million units in the offering. TEPPCO intends to use the net proceeds from the offering to reduce borrowings outstanding under its revolving credit facility and expects to use some of the increased availability under the facility to finance capital expenditures, including expansion of the Jonah gas gathering system and other growth projects. On 6-08 AG Edwards Downgraded BWP from Buy to Hold. On 6-09 Stifel Nicolaus Initiated coverage of TYN at Buy. On 6-13 AG Edwards Downgraded PPX from Buy to Hold and Raymond James downgraded PAA to Market Performerorm. On 6-22 Lehman Brothers Initiated coverage of CPNO at Overweight. On 5-01 AG Edwards Upgraded MMP from Hold to Buy. On 5-02 RBC Capital Markets Reiterated its Outperform for EPD. On 5-11 Morgan Stanley Initiated coverage of PAA at Equal-weight. On 5-11 Morgan Stanley Initiated coverage of WPZ at Overweight. On 5-16 RBC Capital Mkts Downgraded XTEX from Sector Perform to Underperform. On 5-17 Goldman Sachs Downgraded TCLP from In-Line to Underperform. On 5-17 Goldman Sachs Upgraded PAA from Underperform to In-Line. On 5-24 Morgan Stanley Initiated coverage of BWP at Overweight. On 4-05, Wachovia Initiated coverage of XTEX at Outperform. On 4-20 Citigroup Downgraded KMP from Buy to Hold. On 4-24 Citigroup Upgraded SXL from Hold to Buy. On 4-25 Deutsche Securities Upgraded VLI from Hold to Buy. On 6-01 Kayne Anderson MLP Investment Company [KYN] announced its net asset value at May 31, 2006 was $26.48, based on 37.6 million shares outstanding. LYN's five largest holdings: 1. Energy Transfer Partners; 2. Enterprise Products Partners; 3. Magellan Midstream Partners; 4. Kinder Morgan Management; and 5. Copano. On 6-01 Kayne Anderson Energy Total Return Fund [KYE] announced its net asset value per share was $25.83 based on 31.6 million shares outstanding. Equity and fixed income investments were 86% and 14%, respectively, of the Fund's total long-term investments. Long-term investments were comprised of MLPs and MLP affiliates (45%), Canadian Royalty Trusts (29%), Marine Energy Transportation (9%), Coal Companies (6%) and U.S. Royalty Trusts and Other Energy Companies (11%). At May 31, 2006, the Fund's five largest holdings: 1. Kinder Morgan Management, 2. Kinder Morgan, 3. Enterprise Products Partners, 4. Harvest Energy Trust (Canadian Royalty Trust), and 5. Crosstex. On 6-13 Kayne Anderson MLP Investment Company [KYN] declared its quarterly dividend of $0.44 per share for the period March 1, 2006 to May 31, 2006 [the yield in the table above is based on the dividend from the prior quarter - the one recieved in Q2]. This represents an annualized dividend yield of 7.1% based on KYN's closing stock price of $24.74/share as of 6-13-06. The dividend represents an increase of 2.3% from the prior quarter's dividend and represents a 17.3% increase from KYN's initial quarterly dividend rate. This is KYN's sixth consecutive quarterly dividend increase. On 6-13 Kayne Anderson Energy Total Return Fund [KYE] declared its quarterly dividend of $0.44 per share for the period March 1, 2006 to May 31, 2006 [the yield in the table above is based on the dividend from the prior quarter - the one recieved in Q2]. This represents an annualized dividend yield of 8.1% based on KYE's closing stock price of $21.69 per share as of 6-13-06. The dividend represents an increase of 6.0% from the prior quarter's dividend and represents an 8.3% increase from KYE's initial quarterly dividend rate. On 6-20 Energy Income and Growth Fund [FEN] has declared its regularly scheduled quarterly distribution of $0.345 per share. This is a $0.005 per share (1.47%) increase from the previous quarter's distribution of $0.34 per share. The distribution will be payable on July 31, 2006 to shareholders of record on July 18, 2006 with an expected ex-dividend date of July 14, 2006. The Fund's daily American Stock Exchange closing price and daily net asset value per share as well as other information are available at www.ftportfolios.com. NOTE #1: This page is ment to be a supplement for those already getting monthly sector updates from their broker. It hopes to provide more timely data - and cover a wider array of stocks and different valuation metrics. Data entry errors sporadically happen. These supplemental stats omit metrics like Debt/Market Cap and the GP/LP split ratios - but YOU should not. NOTE #2: The operator of this site owns units in BWP, EPD, ETP, MWE and PAA, and units in GP ETE - and this could distort the coverage of those MLPs. Candidates for future acquisition include CPNO and MMP - so news on those will disproportionately draw my attention. Those MLPs with slower distribution growth may have coverage that is slighted. NOTE #3: For MLPs to be in my coverage universe, I must be able to find DCF and EPS estimates for them, they must have been in existence since the first of the coverage year. This is why GEL is not in the universe, and why BWP, HLND, TGP, TLP, USS and WPZ were added in 2006. NOTE #4: Those wishing to contribute DCF data to this site can do so by contacting Bob Martin at factoids@flash.net -- The only way we are going to get consensus DCF stats is if we build them ourselves, and that takes a team effort. The DCF numbers in the first spreadsheet and in the Forecaster spreadsheet users consensus DCF data that this site generates from three analysts/brokerages. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||