×
Triangles background
OUR COMPANY AND AFFILIATES
CBRE GLOBAL INVESTORS

CBRE Global Investors, combined with CBRE Clarion Securities and CBRE Caledon, is one of the world’s leading real asset investment managers providing real estate and infrastructure investment solutions to over 500 clients worldwide.

INVESTMENT MANAGEMENT

CBRE Global Investors

CBRE Clarion Securities

CBRE Caledon Capital Management

Trammell Crow Company

MLPguy
CBRE GROUP

CBRE Global Investors is the investment management division of CBRE Group, Inc. the world’s premier commercial real estate services and investment firm.  The company’s shares trade on the New York Stock Exchange under the symbol “CBRE.”

REAL ESTATE SERVICES

CBRE

CBRE Blueprint
Our Company and Affiliates

This website uses cookies to improve the user experience. By using our website you consent in accordance with our Cookie Policy. Read More

ACCEPT
Triangles background
Back to Insights

January 19, 2014

Viewed 1066 times

Week Thoughts: NGL Prices Vertical, MLPs Horizontal

MLPs were basically flat this week, but both the Alerian MLP Index and the Alerian Equal Weight MLP Index beat the S&P 500, which was down slightly.  Commodity price strength (see below) and slightly lower interest rates did not translate into much immediate MLP price strength.

Weekly MLP Review_1-17-14

Commodity prices were universally strong this week:

  • Crude oil prices rose 1.5%, but remains 4.5% lower than year end
  • Natural gas prices bounced back, +6.1% this week
    • Record natural gas storage withdrawal of 287 bcf
  • Ethane was up 22.8%, which seems like a lot, but is really just $0.06/gallon
  • Propane strength continues, +7.6% this week, makes it +70.6% year over year
    • 52-week highs for both propane and ethane
    • Propane closed the week at its highest price in more than two years (since 1/3/12)

MLP earnings season kicked off with the Kinder Morgan family of companies reporting results on Wednesday that were largely in-line with analysts’ expectations.  The earnings call included some table pounding by CEO Richard Kinder on behalf of what he views as a clearly undervalued Kinder Morgan Inc (KMI), see this WSJ.com blog post about the call.  There was less table pounding around EPB and KMP…  In any event, Kinder will be hosting an analyst day on January 29th to unveil its full year 2014 budget and long term distribution expectations for its various entities.
Winners & Losers
Brand new MLP Cypress (CELP) had a nice pop, rising each of its first 3 trading day to finish the week up 12.3%. On the downside, DKL led the sector lower (-6.9%) after Barlcays downgraded it from overweight to equal-weight. APU was under some selling pressure from ETP’s underwritten offering of APU units owned by ETP, but not weak enough for APU to land on the bottom five chart.

Top5Bottom5_1-17-14

For the year so far, CELP’s early strength catapults it right near the top of the list, alongside CLMT.  DKL dropped from the second spot to out of the top five, but is still up for the year. RNO and GLP continue to trade well early in 2014. In the top five are 3 MLPs with less than $500mm market caps and the average market cap of the top 5 is less than $1.0bn.

Top5Bottom5_1-17-14_YTD

It might be tempting to say that because the top 5 are small cap MLPs, it means small cap MLPs will outperform in 2014 or that you should buy more of them vs. larger MLPs. The top five or bottom five in any given year are typically the more volatile MLPs or are ones that have had a transforming transaction, neither of which are necessarily attractive traits in an MLP.  It is interesting and worth noting, however, that the top five is loaded with small caps, especially when the bottom 5 is loaded with MLPs that have more than $4.0bn market cap (like EPB, ETP and CMLP).
Poll Question
If you haven’t already, check out the 2014 Over Unders post from earlier this week and make sure your vote is counted.  I’ll tally those votes and summarize the results next week.  I will be implementing polls on a more regular basis going forward, some tied to specific weekly transactions, so hopefully that will generate some interesting results.  This week’s poll question is below. Sorry, there are no polls available at the moment.  
News of the (MLP) World

News-of-the-World

Equity

  • Amerigas (APU) announces that Energy Transfer (ETP) priced an underwritten public secondary offering of 8.0mm APU units at $42.73/unit, raising $341.8mm in gross proceeds for the selling unitholder (ETP) (press release)
    • Overnight offering, priced at 4.3% discount to prior close
    • Traded down 1.1% in the next session
  • Cypress Energy (CELP) prices initial public offering of 3.75mm common units at $20.00/unit, raising $75mm in gross proceeds (final prospectus)
    • Priced at the midpoint of the pricing range, which represents a 7.75% IPO yield
    • Opened trading at $20.00, reached a high of $21.74 (+8.7% from IPO price), before closing at $21.30 (+6.5%) on its first trading day
    • CELP is a services MLP that provides saltwater disposal wells and operates a pipeline inspection business
  • GasLog Ltd (GLOG) announces its Board of Directors has authorized the company to file a draft registration statement for an IPO of an MLP that would own certain of GLOG’s LNG carriers with multi-year charters (press release)

Other

  • Crosstex (XTEX / XTXI) and Devon (DVN) announce combined mistream business to be named EnLink Midstream (press release)
  • Cheniere Energy (LNG / CQP) announces CFO change (press release)
    • CFO Davis Thames ceased to serve on 1/14, replaced by Michael Wortley (internal promotion from prior role of VP, Strategy & Risk)
  • Ferrellgas (FGP) announces diversification initiative (away from propane), announces new SVP of Strategic Development to lead it (press release)

Distributions

  • Increases:
    • TRGP: $0.6075, +6.6% quarter over quarter
    • TEP: $0.315, +5.9%
    • HCLP: $0.51, +4.1%
    • TOO: $0.5384, +2.5%
    • TGP: $0.6918, +2.5%
    • NGLS: $0.7475, +2.0%
    • EPD: $0.70, +1.4%
    • KMP: $1.36, +0.7%
    • OKS: $0.73, +0.7%
    • LRE: $0.49, +0.5%
  • Flat
    • EPB (streak of 22 straight quarterly distribution increases officially ends), KMI, TLP, WPT, OCIR
RELATED CONTENT
No posts matching your criteria
MLPguy Post
Week Thoughts: Midstream Better for Sale Midstream traded down each day this week and finished down 3-6% across the different indexes, reversing some of the early 2021 gains.
MLPguy Post
Week Thoughts: Midstream Re-Run Energy stocks, midstream stocks, and MLPs ran back last week’s action with another big week. Like last week, it was 4 straight green days followed by a weaker Friday.
MLPguy Post
Week Thoughts: Big Score for Midstream Midstream broke a 4-week losing streak and rang in the new year with a bang, rallying 7-8% across the midstream indexes. The big week was just the 3rd best week for MLPs since the vaccine news turned things around in early November.
MLPguy Post
Week Thoughts: Another Lost Week, Year for Midstream The short final week of the year was good for most stocks, but Midstream stocks were left out again. The S&P 500, utilities and infrastructure stocks traded up, along with oil and natural gas prices.
MLPguy Post
Week Thoughts: Midstream Santa Rally Melts Midstream underperformed the market for a third straight week after its massive bounce in November and early December. The group is clinging to a positive month of performance with just 4 more trading days left...
MLPguy Post
Week Thoughts: Midstream Checks Out Stocks, oil prices and natural gas prices were all up this week, but midstream stocks took a step back and appear to be coasting to the finish line for the year after the rush to re-position over the last few months.
MLPguy Post
Week Thoughts: Midstream Stalls at Altitude Midstream was mixed this week, with MLPs closing slightly lower after 4 very strong weeks of positive performance. Positive performance from some of the larger corporations in the U.S. and Canada helped the broader midstream indexes finish positive and keep pace with energy stocks...
MLPguy Post
Week Thoughts: Midstream Furious Finish Midstream had another huge week on still more follow-through of positive sentiment shift that’s occurred over the last 5 weeks as positive vaccine news sparked a rotation into value and energy stocks.
MLPguy Post
Midstream Movember: Updated Returns Through Month End Because the end of the month fell on a Monday, we felt it might be useful to post a wrap up on monthly performance for midstream, outside of the normal weekly cycle.
MLPguy Post
Week Thoughts: Midstream Parade Goes On Energy stocks (midstream included) continued their recent run of positive stock performance in this short week, helped by ongoing positive vaccine data points. It was the best Thanksgiving week return for midstream since 2008 (when MLPs were up 20%).
MLPguy Post
Week Thoughts: Midstream Hosts Another Large Gathering Another vaccine update, another rally for energy stocks and midstream stocks. Midstream was green all week until taking a breather Friday. Stocks and the infrastructure index were slightly negative, and utilities were hit hard.
MLPguy Post
Week Thoughts: Midstream Goes Green on Vaccine Energy stocks were buoyed by the big vaccine news Monday, and the gains held for the week overall. XOP spiked 20.4% this week, XLE was up 17.1%. Midstream wasn’t quite that strong but posted with historically significant gains Monday and for the week
MLPguy Post
Week Thoughts: Stocks Get Mandate, Midstream Flips Red The market (and midstream for most of the week) seemed to shrug off the ongoing presidential election malaise this week.
MLPguy Post
Week Thoughts: Pain Distributed Across Markets, Midstream Midstream and MLPs returned to earth this week, following lower oil prices and the market lower. Solid earnings reports from some of the larger names weren’t enough to offset macro headwinds and ET’s large distribution cut.
MLPguy Post
Week Thoughts: MLPs Ramp into Earnings MLPs resumed their October rebound this week with their best week since early August. Energy stocks outside of midstream also had a strong week on the back of merger mania in upstream with another E&P merger announced this week and others rumored.
MLPguy Post
Week Thoughts: Midstream Flattens Friday Midstream and MLPs looked to be coasting to a third straight week of solid gains, but a sharp selloff across energy stocks Friday erased the gains for the week.
MLPguy Post
Week Thoughts: Midstream Unchained, MLP Eruption MLPs followed up last week’s modest bounce with a huge week in a risk-on surge for equity markets, commodity markets and everything else this week.
MLPguy Post
Week Thoughts: Midstream Asymptomatic as Oil Declines The stock market broke its losing streak, and MLPs and U.S. midstream came along for the ride this week, bouncing slightly after a rough week, month, quarter and year. Weakness in Canadian midstream dragged down the AMNA Index.
MLPguy Post
Week Thoughts: Midstream Canceled Again The S&P 500 closed negative for a 4th straight week, while midstream had its worst week since June in what has been a brutal September so far.
MLPguy Post
Week Thoughts: Midstream Yield High, Interest Low Midstream stocks bounced back early in the week after two rough weeks, but then as the market rolled over later in the week, midstream and MLPs were dragged back down.
MLPguy Post
Week Thoughts: Another Setback Setback for Midstream Midstream struggled again this week, in a risk-off week for stocks and commodity prices.
MLPguy Post
Week Thoughts: Midstream, The Final Season With the market taking a very well-publicized breather this week, midstream followed the market and oil prices lower. MLPs were down each day this week and finished down 4.7%.
MLPguy Post
Week Thoughts: Stocks Up, Midstream Down MLPs staged a comeback effort late in the week (+3.7% Wednesday to Friday), but finished down vs. last week, and well below the S&P 500’s 3.3% gain.
MLPguy Post
Week Thoughts: Midstream Militia Retreats After a few weeks of positive performance, midstream rolled over this week. Energy stocks in general were negative, despite benign commodity price movements and strength among market indexes (which clearly are dominated by tech stocks).