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I have two brokerages in which I need to update the DCFs, and then update the consensus DCF estimates - so these are NOT the final numbers for September. But the prices, EPS estimates, target prices, CAGRs and ratings are month end numbers. The spreadsheet below uses month ending data. The 'monthly price change' column is for unit price changes, while the 'year to date' stats is for total return. This explains the jumps in year to date gains in the distribution heavy months of February, May, August and November without similar gains in those month's unit prices. CEF numbers are for MLP and MLP-hybrid Closed-End Funds. The 'Ten Year Yield' numbers are for the US Treasury. Tracking the spread of the average MLP's yield to the Treasury has been a useful tool for timing of MLP purchases - buy MLPs when the spread is high. The CEF spread is used in academia to measure investor sentiment. Buy MLPs when the price is at the largest discount to NAV.
Copano Energy Acquires Cantera & Does Private Placement of $335 million AP 9-04 Copano Energy LLC said Tuesday it's agreed to purchase Cantera Natural Gas from private equity firm Metalmark Capital for $675 million in cash and stock. The purchase price consists of $562.5 million in cash and about 3.2 million in Class D units. Cantera's assets consist primarily of a 51.0% managing member interest in Bighorn Gas Gathering, LLC and a 37.04% managing member interest in Fort Union Gas Gathering, LLC, which operate natural gas pipeline systems in Wyoming's Powder River Basin. The Bighorn system includes approximately 238 miles of natural gas gathering pipelines, which deliver natural gas into the Fort Union system. The Fort Union system consists of an approximately 105-mile, 24" pipeline with a 62-mile loop. Based on Copano's more diversified geographic footprint and contract mix on a combined basis, management anticipates that it will recommend to its Board an increase in the quarterly cash distribution rate (currently $1.76/unit) to at least an annual rate of $2.15 per common unit beginning with the third quarter of 2008, with appropriate interim increases. Copano agreed to sell $335 million in equity securities through a private placement to third-party investors. The securities include about $157 million in Copano common units and $178 million in Class E units. The company said Class E units are a new class of Copano shares that have no voting rights beyond those required by law and are subordinate to common units on dissolution and liquidation. The units will be entitled to a special distribution in the fourth quarter of 2008. They convert to common units on payment of a distribution in the third quarter of next year if terms are approved by shareholders. ETP Acquires Midstream Assets in Piceance-Uinta Basin BusinessWire 9-07 Energy Transfer Partners, L.P. has entered into an agreement to acquire midstream company Canyon Gas Resources, LLC from Metalmark Capital. The assets purchased in this transaction are located in the prolific Piceance-Uinta Basin in Colorado and Utah. The Piceance-Uinta Basin is believed to have the potential to be one of the largest natural gas plays in North America. The Canyon system has over 400,000 of dedicated acres under long-term contracts. Some of the largest U.S. producers are active in the area and are major customers of the system. The Canyon assets include a gathering system in the Piceance-Uinta Basin which consists of over 1,800 miles of 2"-16" pipe with a projected capacity of over 300,000 MMbtu/d, as well as 6 processing plants for NGL extraction and gas treatment with a processing capacity of 90 MMcf/d. MarkWest Energy Partners to Merge with MarkWest Hydrocarbon BusinessWire 9-07 MarkWest announced that MarkWest Energy Partners [MWE] and MarkWest Hydrocarbon [MWP] have entered into a definitive redemption and merger agreement. The total value of the transaction is approximately $734 million. MarkWest Hydrocarbon shareholders will receive aggregate consideration of approximately 15.4 million common units of MarkWest Energy Partners and cash of $240 million. This represents $61.12 per share of consideration to be received by the MarkWest Hydrocarbon shareholders based on the closing price of MarkWest Energy Partners units on September 5, 2007, a premium of 22%. In the transaction, the incentive distribution rights in MarkWest Energy Partners will be extinguished and MarkWest Hydrocarbon will become a wholly owned subsidiary of MWE. Additionally, MarkWest Energy Partners will acquire interests in the general partner of MarkWest Energy Partners currently held by key management employees of MarkWest Energy Partners. The transaction is expected to be accretive in 2008 to the MarkWest Energy Partners unitholders as measured by distributable cash flow per unit. El Paso Pipeline Partners LP [EPB] Files to IPO Reuters 8-31 El Paso Pipeline Partners LP filed with regulators on Friday to sell up to 25 million common units in an initial public offering. The MLP was formed by El Paso Corp. (EP) to own and operate natural gas transportation pipelines, storage and other midstream assets. Following this offering, El Paso said it will own the 2 percent general partner interest, all of the incentive distribution rights, a 65.8 percent limited partner interest in El Paso Pipeline Partners. Moody's Raises Regency Credit Ratings AP 9-11 Moody's Investors Service upgraded Regency Energy Partners LP's credit ratings to investment grade Tuesday due to RGNC's repayment of debt with proceeds from a $354 million public equity offering in July. Moody's lifted RGNC's corporate family rating to investment grade "Ba3" from noninvestment grade, or "junk"-rated, "B1." Moody's lifted its senior unsecured notes, to "B1" from "B2" and its senior unsecured debt to "B1" from "B2." Regency's outlook is "Stable." RGNC has paid off nearly half its debt and nearly tripled its book equity since June 30 due to the offering. RGNC has paid down $193 million of its $550 million in master limited partnership notes and eliminated a $50 million term loan of its gas service subsidiary. The ratings agency said it was too early to tell whether General Electric Co.'s purchase of a $603 million stake in Regency in June will help RGNC financially. Fitch Cuts View on ETP AP 9-12 Fitch Ratings lowered its outlook for Energy Transfer Partners LP on Wednesday, citing legal proceedings against the company that may result in monetary penalties. Fitch revised the natural gas transportation and storage company's credit outlook to "Stable" from "Positive," which means an increase in ratings could occur within the next six months. Fitch holds ETP's long-term issuer default and senior unsecured debt ratings at "BBB-," which is at the low end of investment grade. K-Sea Announces Pricing of Offering of 3.5 Million Units Business Wire 9-21 K-Sea Transportation Partners announced that it has priced its previously announced public offering of 3.5 million common units representing limited partner interests at $39.50 per unit. The offering is scheduled to close on September 26, 2007. Prior to the offering KSP had 10.2 million units outstanding. On 9-06 UBS upgraded DEP from Neutral to Buy, upgraded KSP from Neutral to Buy, and upgraded TGP from Neutral to Buy. On 9-07 Friedman Billings Initiated TGP at Market Perform. On 9-10 Wachovia Upgraded MWE from Market Perform to Outperform. On 9-12 Wachovia Initiated SGLP at Outperform. On 9-14 Goldman Sachs Initiated KGS at Buy. On 9-17 AG Edwards and UBS Initiated KGS at Buy. On 9-21 Wachovia Upgraded NGLS from Market Perform to Outperform, Deutsche Securities Upgraded BPL from Hold to Buy and Downgraded BGH from Buy to Hold. On 9-28 Morgan Keegan Initiated PAA at Market Perform and initiated MWE at Outperform. On 9-25 Goldman Sachs lowered its rating on general partner master limited partnerships to "neutral" from "attractive," saying valuation now appears to more appropriately recognize the leverage general partners have to corresponding MLP's distribution growth. Goldman raised Magellan Midstream Partners to "buy" from "neutral" and raised Teppco Partners to "neutral" from "sell." The brokerage said it continues to prefer master limited partnerships with visible capital expansion programs and distribution growth profiles. It downgraded Crosstex Energy to "neutral" from "buy", Enbridge Energy Management LLC and Enterprise GP Holdings to "sell" from "neutral." On 9-25 ETP declared a distribution of $0.825/unit [0.80625 last quarter] to be paid 10-15 to unitholders of 10-5-07. The CAGR estimates were influenced by those attained from Yahoo, but are primarily based on those from AG Edwards. The DCF estimates for ATN, BBEP, EVEP and LINE are from AG Edwards. Those for CEP and LGCY are based on their current distributions, where I used dcf/.9 = distribution [which is approx the sector average] to arrive at a DCF. And the EVEP 2008 EPS estimate was also absent at Yahoo - so I used the current trend to estimate that. This whole sector is brand new, with ONLY LINE having paid a distribution in 2006. And the abscence of a track record causes the CAGR estimates to be varied and undependable. The unit price gains in this sector have been too high to ignore. The P/E ratios still look very attractive relative to standard MLPs. And many of the CAGR estimates [estimate that are so high that I am not using them for my metrics] for most E&P's are significantly higher than most regular MLPs. At the moment, I still have a problem believing the CAGRs would be higher for sustainable periods. E&P's can purchase assets at lower enterprise values to EBITDA ratios and thus make more accretive acquisitions compared to midstream MLPs, where the purchase of these acquistions by traditional MLPs now come with higher price tags and lower accretion. I would suspect that over time, the EBITDA multiples for E&P assets will grow too. Because of the hyper-accretiveness of new acquisitions, those E&P MLPs with the newest and the highest percentage of acquisitions will be the ones that will probably have the highest unit price appreciation. Thus the Forecaster Model - which uses valuation and CAGR differences to mathamatically find MLPs that are undervalued - would logically be less predictive in this sub-sector. ENP IPOs AP & Reuters at various dates On 9-12 Encore Energy Partners LP [ENP] IPOed at $21.00 with 9 million units raising $172 million. ENP was the sole IPO slated for this week, and the offering broke the traditional late summer IPO recess, marking the first new flotation on a U.S. exchange since mid-August. Scott Sweet, managing director of research firm IPO Boutique, says Encore's initial distribution rate of 35 cents/unit per quarter is fairly attractive [6.45% at Friday's closing price of $21.70] and will likely increase based on the company's production and the amount of cash it generates. "I expected a bigger push [ENP closed up 3 cents on its opening day]. I had heard that the deal was well subscribed, and these master partnership deals have done better than this," said Sal Morreale, who tracks IPOs for Cantor Fitzgerald. Morreale said he expected a jump in oil pricing also to give Encore's first-day performance a boost. "Especially with oil touching $80 (per barrel) today, I thought you were going to see a bigger push than this. The volume looks pretty good, I don't know why it was not well received." Some MLPs have been stagnant of late due to the increased volatility of the market. MLPs by nature depend on completing acquisitions to drive growth, and when credit spreads widen, acquisitions become less accretive, said Sam Snyder, a senior analyst at Renaissance Capital's IPOHome.com. LGCY Buys Reserves for $60.5 Million AP 9-04 Legacy Reserves LP agreed to buy privately-held oil and natural gas reserves in the Texas Panhandle for $60.5 million in cash. The oil and gas partnership estimates the site holds proved reserves equivalent to 3.95 million barrels of oil equivalent, or "boe." The 263 existing wells now at the site produce an average of 606 boe per day, giving the site an estimated lifespan of 18 years, Legacy said. Encore Energy Partners LP Announces IPO Business Wire 9-04 Encore Energy Partners LP has commenced an initial public offering of 9,000,000 common units representing limited partner interests. The common units will be listed on the NYSE under the symbol "ENP." The common units offered to the public will represent approximately 37.4% of the outstanding equity of Encore Energy Partners, or approximately 40.7% if the underwriters exercise their over-allotment option in full. Encore Acquisition Company (EAC) and management of Encore Energy Partners will own the remaining equity interests in Encore Energy Partners. Encore Energy Partners' assets consist primarily of producing and non-producing oil and natural gas properties in the Elk Basin of Wyoming and Montana and the Permian Basin of West Texas. As of December 31, 2006, on a pro forma basis after giving effect to the acquisition of the Elk Basin assets from subsidiaries of Anadarko Petroleum Corporation, Encore Energy Partners' total estimated proved reserves were 21.4 MMBOE [15.1 MMBOE in Elk Basin in Montana/Wyoming and 6.3 MMBOE in the Permian Basin in west Texas], 68% of which were oil and 86% of which were proved developed. This compares to EAC’s total estimated proved reserves were 226 MMBOE, 83% of which were oil and 69% of which were proved developed. More info can be found at http://ipo.nasdaq.com/ViewFiling_frames.asp?filename=0000950134%2D07%2D019086%2Etxt&filepath=%5C2007%5C08%5C28%5C Exco Partners Files $1.7 Billion IPO MarketWatch 9-14 Exco Partners LP has filed to raise up to $1.7 billion in the richest energy-related limited partnership to go public in the U.S. The unit of Exco Resources (XCO) plans to trade on the New York Stock Exchange under the symbol XP. It'll offer 75 million units. MLP CEF SRV IPOs Various The Cushing MLP Total Return Fund (SRV) had its initial public offering on August 27, 2007. SRV will invest at least 80% of its net assets, plus any borrowings for investment purposes, in MLP investments. For purposes of the Fund’s 80% investment policy, MLP investments are investments that offer economic exposure to public and private MLPs in the form of common or subordinated units issued by MLPs, securities of entities holding primarily general partner or managing member interests in MLPs, debt securities of MLPs, and securities that are derivatives of interests in MLPs. SRV will be managed by Swank Energy Income Advisors. S&P Launches MLP Index PRNewswire 9-05 Standard & Poor's announced today the launch of the S&P MLP Index, an index designed to serve the investment community's need for a tradable benchmark representing the fast growing, $200 billion Master Limited Partnership market. To be eligible for the S&P MLP Index, companies must be publicly traded partnerships with a float-adjusted market capitalization above US$ 300 million, and have a three-month average daily value traded above US$ 2 million. The index is rebalanced once a year in July. Standard & Poor's also issued a white paper today discussing Master Limited Partnerships [ "Master Limited Partnerships - A Primer"]. The base value of the S&P MLP Index is 1000 on July 20, 2001. Data history begins on July 20, 2001. Daily returns are available starting from that date. The Bloomberg ticker for the index is "SPMLP" and the Reuters ticker is ".SPMLP". On 9-10 Ferris Baker Watts Downgraded TYG and TYY from Buy to Neutral. On 9-19 KYE declared a dividend of $0.47/share payable on October 12, 2007 to shareholders of record on October 3, 2007, with an ex-dividend date of October 1, 2007. Also on 9-19 KYN declared a dividend of $0.49/share payable on October 12, 2007 to common stockholders of record on October 3, 2007, with an ex-dividend date of October 1, 2007. MGG Prices Secondary Offering PRNewswire 9-05 Magellan Midstream Holdings [MGG] announced that it has priced a secondary offering of 8.5 million common units representing previously outstanding limited partner interests in MGG. MGG Midstream Holdings, L.P. [which is not 'MGG'] is primarily owned by private equity firms Madison Dearborn Partners, LLC and Carlyle/Riverstone Global Energy and Power Fund II, L.P. Following this offering, MGG Midstream Holdings, L.P. will continue to own approximately 14% of the outstanding common units of MGG, with the public owning the remaining 86%. MGG Midstream Holdings, L.P. will receive all net proceeds from the sale. Prior to the sale. there were 62.65 million shares outstanding of MGG. Energy Transfer Equity Files Two Registration Statements Bueiness WireR 9-25 Energy Transfer Equity, L.P. announced the filing of a Registration Statement on Form S-3 with the SEC of two prospectuses. The first prospectus covers the registration of up to $2.0 billion of common units that may be sold by Energy Transfer Equity from time to time. The second prospectus covers the registration of outstanding common units owned by existing ETE unitholders that may be sold from time to time by these unitholders. On 9-25 ETE approved a distribution of $0.39/unit to be paid on October 19, 2007 to Unitholders of record as of the close of business on October 5, 2007. On 9-13 Goldman Sachs analyst David Chiaro removed XTXI from 'the Americas Buy List'. He still likes the company's prospects, but as the shares have gained more than 25 percent since he upgraded the company in March he does not see much room for appreciation. Chiaro's price target on Crosstex's shares is $36. The shares closed Wednesday at $35.28. NOTE #1: This page is ment to be a supplement for those already getting monthly sector updates from another source. Data entry errors sporadically happen here. There are metrics like Debt/Market Cap, system capacity useage, organic growth in process to total market cap, and the GP/LP split ratios that should not be ignored but are not covered here. NOTE #2: The operator of this site owns units in BWP, EPD, ETP, DPM, KGS, MWE and PAA, and units in GP MGG, and candidates for future acquisition include TGP and WPZ - and this could distort the coverage of those MLPs. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||