No Taxation Good, Liquidity Crisis Bad

Source: Hinds Howard, MLP Hindsight (9/29/11)

"For the most part, MLPs have done a good job of shoring up balance sheets and coverage ratios over the last 2-3 years since the last liquidity crisis and are well positioned to outperform."

Master Limited Partnerships (MLPs) had an outstanding week on a relative basis, beating the S&P 500 by more than 450 basis points, but lost 2% on an absolute basis. This out-performance is even more pronounced compared to the energy index EPX (down more than 16%), and against crude oil's 9%+ decline. Most of that relative performance occurred on Monday, when MLPs were up 2.1%, while the S&P 500 lost 1.0%, after it became clear that a) the President's jobs bill did not include taxing partnerships, and b) the President's jobs bill had little chance of passing, and seemed more political than anything. With the tax threat removed from the top of investors' minds, MLPs melted up Monday and Tuesday, but couldn't keep the divergence from broader markets going on Wednesday afternoon when the Fed's operation "Twist" was announced. From Tuesday's close to the end of the week, MLPs dropped 4.8%, including 2.8% on Wednesday alone, as shown in the below chart of the MLP index for the week.

Oil, MLPs, Investing, Hinds Howard

MLPs are currently yielding around 6.9%, or 509 basis points more than 10-treasury notes, compared to an average since 1998 of approximately 336 basis points. This spread is as wide as it has been since late 2009. For the most part, MLPs have done a good job of shoring up balance sheets and coverage ratios over the last 2-3 years since the last liquidity crisis, and are well positioned to outperform, as investors seek yield and as they recall how secure MLP distributions were through 2008-2009, with none of the top 25 largest MLPs cutting distributions.

Amidst the global stock market meltdown last week, there were clearly more losers than winners in the MLP space. Coal names dominated the list of biggest losers this week. On average, coal MLPs declined 6.4% week over week.

There was quite a bit of MLP news this week, including an equity deal by Enbridge Energy Partners, L.P. (EEP/EEQ:NYSE) that raised $218M (Press Release).

Should be another very interesting week in the markets, which hopefully will continue to be led by MLPs, as investors take profits in gold and treasuries. . .

NGL Energy Shares Rise 21% as It Seeks to Raise $2.05 Billion from Senior Secured Note Offering
Source: Streetwise Reports (01/21/2021)

Shares of NGL Energy Partners LP traded higher after the firm made a series of announcements over the past three days regarding an update on financial operations, a settlement with a customer in bankruptcy, a quarterly Class D unit distribution and a $2.05 billion senior secured debt offering.

Western Midstream Posts 99% YoY Increase in Q3 Earnings, Announces $250 Million Buyback Program
Source: Streetwise Reports (11/10/2020)

Shares of Western Midstream Partners traded 23% higher after the company reported Q3/20 financial results that included a nearly 100% growth in Net income. The firm also provided FY/21 guidance and announced a $250 million buyback program.

Altus Midstream Shares Flow Higher on Q3 Earnings and Plans for $1.50/Share Dividend in Q1/21
Source: Streetwise Reports (11/05/2020)

Shares of Altus Midstream Co. traded 170% higher after the firm reported Q3/20 financial results and announced plans to pay a quarterly dividend of $1.50 per share beginning in March 2021.

'Breaking Up Can Be Good for You': Money Manager Offers Updates from Five Resource Companies
Source: Adrian Day for Streetwise Reports (10/21/2020)

Money manager Adrian Day reviews major developments at two companies, which he believes "should be very beneficial," and updates developments at several juniors, noting "some very strong buys."

Announcing Streetwise Live! Events
Source: Streetwise Reports (07/13/2020)

Streetwise Reports is offering 100 investors—at no charge—the opportunity to meet via Zoom with executives of precious metals companies as they discuss recent developments at their companies and upcoming catalysts.

NGL Energy Partners Shares Rise 80% as the Firm Confirms 2020 Guidance
Source: Streetwise Reports (03/19/2020)

Shares of NGL Energy Partners traded higher after the company confirmed its fiscal 2020 EBITDA guidance and provided an update on current operations and capital expenditure reductions.

'Strong Finish' to 2019 for Miner, 'Dividend Beat Expectation'
Source: Streetwise Reports (02/27/2020)

Last year's performance by Glencore International is summarized in a BMO Capital Markets report.

Tallgrass Energy Shares Rise 20% on Blackstone Partners Acquisition Deal
Source: Streetwise Reports (12/17/2019)

Shares of Tallgrass Energy LP traded 20% higher after the firm advised that it entered into a definitive merger agreement with Blackstone Infrastructure Partners to acquire all of the company's publicly held outstanding class A shares for $22.45 per share in cash.