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

August 18, 2013

Viewed 1088 times

Week Thoughts: Summer Closeout - Stocks, Treasuries and MLPs Marked Down

MLPs dropped 2.1% this week, roughly the same as the S&P 500 (-2.0%).  MLPs were unable to withstand the broader market breakdown for two consecutive weeks, and the multiple MLP equity offerings we saw this week.  So after outperforming last week when the S&P 500 was down 1.0%, MLPs succumbed this week.  While MLPs were down for the week, the losses happened early in the week and MLPs were actually up slightly on the weakest day of the week for the S&P 500 (Thursday).
Usually, when the market falters, at least some of the money flows into US treasuries.  That didn’t happen this week, with the US 10 YR interest rate rising to a fresh 52-week high at 2.83%, which doesn’t bode well for MLPs.  Gold was the trade of the week, up 4.5%.  Energy commodities were also all up this week, with propane continuing its recent run up another 5.3% to lead the way this week.

Weekly MLP Review_8-16-13

Short post this week and probably next week to recharge my batteries.  Expect MLPs to drift higher once the equity printing presses shut down in late August.
Winners & Losers
GLP bounced back this week to lead the MLP sector with 9.2% pop.   The news that MMLP was getting a new GP partner in Alinda Capital sent it higher Thursday.  The list of independent GPs with no private equity or corporate backing continues to shrink.  Expect those MLPs that still have an unattached GP to outperform going forward.  On the negative side, EVEP was down 10% in what seems to be a reaction to the news from last Friday on the first sale of Utica acreage.  Also notable, USAC was down on earnings and the acquisition announcement that adds 7.4mm to the unit count.

Top5Bottom5MLPs_8-16_13

For the year, no change in the bottom five constituents.  On the top five, MMLP and AMID popped into the top five, LGP and BPL dropped out of the top 5.

Top5Bottom5MLPs_8-16_13_YTD

News of the (MLP) World

News-of-the-World

Equity

  • Northern Tier Energy (NTI) prices public secondary offering of 11.5mm common units at $22.85/unit, raising gross proceeds of $262.8mm for selling unitholder Northern Tier Holdings
    • Overnight deal, priced at 4.0% discount to prior close, no change from pricing in next trading session
  • Access Midstream (ACMP) prices public secondary offering of 8.0mm common units at $46.47/unit, raising gross proceeds of $371.8mm for selling unitholder Global Infrastructure Partners
    • No primary units issued
    • Overnight deal, priced at 4.5% discount to prior close
    • ACMP traded up 0.7% in the next trading session
  • Rose Rock Midstream (RRMS) prices public offering of 4.75mm common units at $33.44/unit, raising $158.8mm in gross proceeds
    • Overnight offering, priced at 3.9% discount to prior close
    • Closed next session down 2.1% from pricing
  • Kinder Morgan Energy (KMP) files equity distribution agreement to sell up to $1.9bn at the market

Debt

  • Plains All American Pipeline (PAA) prices $700mm of 3.850% senior notes due 2023 at 99.792% of par
  • Access Midstream (ACMP) prices $400mm of 5.875% senior notes due 2021, adding on to previous April 2011 $350mm 5.875% senior notes due 2021 with a yield to worst of 5.503%
  • NuStar Energy (NS) prices $300mm of 6.750% senior notes due 2021 at par

M&A / Growth Projects

  • StoneMor (STON) announces $5mm acquisition of Virginia-based Forest Lawn Cemetery
  • USA Compression (USAC) announces $187mm acquisition of compression assets from S&R Compression
    • USAC to acquire compression assets from S&R Compression from an affiliate of George B. Keiser
    • USAC will acquire 983 compression units (138,000 HP), with an average age of 2.2 years and average utilization of 95%
    • Units deployed primarily in Oklahoma and Texas, in the Mid-Continent, Haynesville and Fayeteville regions
    • Transaction funded with approximately 7.4mm USAC common units issued to the Kaiser affiliate
    • USAC expects to close the acquisition in 3Q13 (by the end of August is likely)
  • Calumet Specialty Products (CLMT) announces acquisition of 7 crude oil loading facilities from Murphy Oil USA

Other

  • Martin Midstream Partners (MMLP) announces that its GP will sell a 49% voting interest (50% economic interest) to Alinda Capital Partners
  • Plains All American Pipeline (PAA) announces discontinued JV with Keyera Corp. for development of the Western Reach Pipeline system

Distribution Announcements

  • Variable: NTI: $0.68
RELATED CONTENT
No posts matching your criteria
MLPguy Post
Final K-1: MLPguy Transition to New Era Starting this week, you will find my usual weekly updates on the midstream / MLP sector at mlpguy.substack.com.
MLPguy Post
Week Thoughts: Midstream Rides Market Jet Stream Higher Midstream stocks took some lumps with earnings announcements, but strength in oil prices, energy stocks (S&P Energy +8.3%) and the S&P 500 was enough to carry midstream to a strong positive week.
MLPguy Post
Week Thoughts: Midstream Pumped, Market Dumped Midstream indexes followed the S&P 500 lower this week, but MLPs outperformed factoring in distribution ex-dates from this week.
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.