October 20, 2013
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MLPs were along for the ride this week (MLP Index +1.7%), rising in tandem with the broader market’s rally (S&P 500 +2.4%, closing the week at fresh all-time highs). The oil futures price dropped to nearly $100/bbl on the November contract, and natural gas was roughly flat. The market liked that the U.S. was able to avoid default and that the government GDP machine would be getting back to work. Its hard to envision how the next deadline in a few months goes any different, but hope springs eternal in the stock market at least, as this week proved. 
You might notice that my chart above is a little light on data relative to what you normally see here (no MLP Index total return, no S&P 500 total return, no ethane and propane). That has something to do with not having access to bloomberg data at the moment, more on why below. You might also notice that the top 5 and bottom 5 charts aren’t in this post like they normally are, and that’s because of a totally unrelated issue of me forgetting to bring my laptop why travelling cross country for the weekend and attempting to complete a post using a combination of my ipad with a wordpress app and the boarding pass printing kiosk in the lobby of my hotel. The combination of the above factors makes this post pretty bush-league compared to what you might be used to. My apologies.
As mentioned above, I am in between market data providers at the moment, because I am in between jobs. Friday was my last day at Guzman & Company, which was a great place to work with great people, and which provided me with a platform to publish research and to manage assets.
But, I was offered the opportunity to end my short-lived sell-side equity research career and to join an investment team at a large asset management firm with a growing strategy. In a few weeks, I will start at CBRE Clarion in the suburbs of Philadelphia. CBRE Clarion manages $24bn in assets, mostly in strategies targeting publicly-traded real estate firms, but the firm is dedicated to growing its Global Listed Infrastructure strategy. I am joining that team to cover oil and gas pipeline and storage companies, including MLPs.
Since taking the job and agreeing to move to the Philadelphia area, I have tried to find movies that would help me give my wife a sense of the area. Wikipedia reminded me that one of my favorite of the early R-rated Eddie Murphy comedies was set in Philadelphia: Trading Places. The movie itself offers very little parallel to my current situation, and whatever sense of the city in the movie is now 30 years old, but I do relate to the scene where Randolph and Mortimer Duke offer Billy Ray the opportunity to get out of the limo they picked him up in. He looks around at the fancy car, the cigars and the high-end hooch, and he says: “No. No, I believe I can hang out with you fellas for a little while…”
What does the new job mean for the future of MLPguy’s presence on the web? For now, I am going to continue to publish at least weekly (with more and better data). Longer term, I’m not sure. But, wherever and whatever I do publish, I’ll make sure you guys hear about it. CBRE Clarion has already published some interesting whitepapers on infrastructure investing (see here), and we will likely produce additional MLP-focused content once I get acclimated, so stay tuned.
Abbreviated News of the (MLP) World
The Kinder Family of MLPs reported earnings on Wednesday. KMP results generally met analysts’ expectations, and there is some buzz around the NGL pipeline JV with MWE. EPB results were largely inline as well, although EPB will have some headwinds from recent rate case settlements on Wyoming Interstate Company and Southern Natural Gas systems. Both MLPs are running at less than 1.0x distribution coverage on purpose, which is one of the reasons I am not a huge fan of either EPB or KMP for new money. If you must own something Kinder, KMI is the way to go, and if you think Kinder / MWE will dominate the Bluegrass Pipeline, then MWE is the way to play that specific solution.
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