EUROPE’S ENERGY CRISIS IS KEEPING ENERGY PRICES AND INFLATION HIGH
America leads the world in oil and gas production. We believe midstream energy infrastructure offers predictable cash flows to investors..
How Do You Break a Pipeline Contract?
Given the collapse in MLP prices over the last six months virtually any explanation is worth considering. Operating results continue to be unremarkable – Kinder Morgan (KMI) reported 4Q15 financials last week. Their full year 2015 results were 4% lower than their budget; two thirds of the miss was in their CO2 business which is sensitive […]
Pity the Equity Analyst
This week I felt a pang of pity for a sell-side research analyst. Not an obviously sympathetic constituency, you might well retort. There are many other categories of employment more deserving of such consideration – indeed, probably too numerous to list here. But I did, and here’s why. This particular analyst (he’ll remain nameless because […]
We’re All Crude Oil Traders Now
Pioneer Natural Resources (PXD) was dubbed “The MotherFracker” by David Einhorn last May at the Ira Sohn Value Investing Conference. Einhorn is bearish on PXD and other E&P companies that use hydraulic fracturing to release crude oil from shale formations because he calculates that after properly accounting for their capital investment they don’t grow their […]
The 2015 MLP Crash; Why and What’s Next
The 32.6% collapse in MLPs was in many ways worse than the 2008 financial crisis. Although not as bad as 2008 when MLPs lost 36.9%, almost every asset class was down that year so there was little unique about MLP performance. In 2015 MLPs endured their own, private performance disaster. The Energy sector was in […]
Adapting to New Circumstances
Investors are focusing carefully on the response of Master Limited Partnership (MLP) managements to the impact of a higher cost of equity on their growth plans. Those firms that moderate their growth forecasts in response so as to rely less on issuing equity and maintain their distribution coverage are acting thoughtfully with the best interests […]