Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
KMI - On the road to disaster?
Old 08-03-2015, 11:40 AM   #1
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
KMI - On the road to disaster?

One of the highlights of last year for me was the buyout of my Kinder Morgan Partnership KMP. Now when I look at KMI which is the surviving entity if you took the shares, which I did not. Looking at their balance sheet I see major headaches for them. Value Line on June 5th lowered the safety rating on KMI from 2 to 3 which is very unusual and a warning sign to immediately sell if I did own KMI. KMI has done very well in the zero interest rate environment as they have used debt to expand and pay generous distributions to their shareholders.

They appear totally dependent on being able to borrow large sums of money to maintain their model. They are paying out $1.92 in dividends yet only earning $1.00 per share. Their Capital Spending plan is $1.80 per share which is about $0.80 per share higher than depreciation, meaning just to pay dividend and capital spending plan they need to borrow, or issue new shares for $1.72 per share, nearly 2 Billion dollars. This for a company with revenues of $6.95 per share. 54% of sales for dividends and expansion for a company with the amount of debt already incurred is not sustainable. A 2 percent increase in interest rates would mean a 50% increase in interest expense for a company with 12 billion in long term debt needing to be rolled in the next 5 years.

Right now KMI already has debt of $20.00 per share or 41 Billion dollars, which is twice the dollar level of debt of Exxon Mobil which has sales of $65 per share. Exxon Mobil debt is $5.00 per share. Chevron's debt is $16.67 per share at 31.5 Billion. The day the capital markets dry up for KMI for additional debt, is the day they will be forced to cut the dividend more than in 1/2.

The stock has fallen to $33 but this stock could easily fall below $20. The bull case implies the ability to borrow in the coming years a couple billion a year at present low interest rates, not an investment I would advocate.

This quick look I did at KMI because I wanted to see if I was interested in the new entity did show me how financially strong Exxon Mobil is, at 73 it will be yielding 4 percent and the risk of a dividend cut in the next 2 years is very low. That would continue to be the oil play I would recommend, assuming Exxon gets to that price point.
__________________

__________________
Running_Man is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 11-02-2015, 07:33 PM   #2
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
3 Month update:

KMI has announced that they no longer can plan for 10% annual growth in dividend and looking for 6-10 percent for next year. Price today closed at 26.6 down 23 percent from original post and getting close to the target of 20. The non GAAP statistic of distributable Cash Flow should be ignored!!! look at GAAP and adjust yourself if needed to see what they are doing and if you want to invest in the company. Here is a link to their 9 months and quarterly earnings and balance sheet of 2015. With 2.173 billion average shares and $1.05 in dividends not covered by earnings ($1.48 -$0.43) you get a shortfall of $2.281 billion dollars. Add back the non cash write-off of assets for impairment of value of 489 million and you have $1.783 Billion in cash needed for dividends, which just happens to be the amount of debt they have added since 12/31/2014. This is a bit of an oversimplification but needed for this post to not become an accounting analysis.

So the 2 billion a year in additional debt to maintain the dividend appears to be the plan. For this plan to work in the long term the business would need to take off in profitability in order to cover the debt being added. Growing the debt at 5 percent per year increases the risk of this company with every year they continue to do this as earnings are falling and not rising. Wait for $20 if you really truly feel you want to invest in KMI

http://ir.kindermorgan.com/sites/kin...I_Q3_2015_.pdf

Exxon Mobil price did fall below 73 and is up 16.8 percent from that 73 to 85.29 today and that was obtainable as XOM fell to 68 and if you had paid the price of XOM when I posted this (78) you would be still up about 8 percent and XOM would still be my preference today although I always find planning for stock prices advantageous for minimizing risk in the long run. The advantage of waiting for Exxon@ 73 instead of buying KMI @ 33 is that today you would have an investment 40% !! greater in value with Exxon than one with KMI, prices matter
__________________

__________________
Running_Man is offline   Reply With Quote
Old 11-02-2015, 08:27 PM   #3
Recycles dryer sheets
 
Join Date: Jul 2013
Posts: 189
Cherry picking dates also helps. how about if I bought KMI sept 29.
__________________
alaska55 is offline   Reply With Quote
Old 11-02-2015, 08:48 PM   #4
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
Quote:
Originally Posted by alaska55 View Post
Cherry picking dates also helps. how about if I bought KMI sept 29.
Well since I gave price and date and expected price I hardly think I can be accused of cherry picking, but if you cherry picked Sept 29 you'd be up 1.8 percent, 15 percent behind XOM @73. But you would also be at risk of about a further decline of 25 percent in the coming months I think. I don't think I'd want one of your cherry pies, your cherry's are a bit sour for my taste.


https://www.google.com/finance?chdnp...NInFjAGe0YvgAQ
__________________
Running_Man is offline   Reply With Quote
Old 11-02-2015, 10:26 PM   #5
Moderator Emeritus
aja8888's Avatar
 
Join Date: Apr 2011
Location: The Woodlands, TX
Posts: 7,128
I loaded up on XOM at $72 and still have 100 shares of KMI left to sell which cost $31. Maybe I'll dump the KMI at market price and use the cash for Chevron.

Or maybe I'll just sit on the cash until the next time XOM goes to $70.

There is just too much crude oil above ground to feel good here. I was on a gas asset sale recently and those assets probably won't find buyers. I was shocked at seeing about 75 Marcellus wells shut in and they cost about $10 Mil each to drill and frac. No gas customers....what the heck were they thinking when they drilled those big wells?
__________________
......."Everybody has a plan until they get punched in the face." -- philosopher Mike Tyson.
aja8888 is offline   Reply With Quote
Old 11-03-2015, 09:41 AM   #6
Full time employment: Posting here.
hesperus's Avatar
 
Join Date: Aug 2013
Location: colorado
Posts: 519
There was an article in Barrons last february about KMP (before the transition), that drew attention to the partnership's model for distributable cash flow (DCF). Kinder Morgan's expansion capital is almost entirely financed with new debt and equity from the MLP, making it vulnerable to higher interest rates and dislocations in the capital markets. That may be true about many MLP's, but KMP was apparently highly leveraged. Makes me wonder if the transition out of partnerships bought them some time and accounting cover, but is still an unsustainable model in the current environment. There are certainly enough questions being raised about KMI over the last year to give one some trepidation about investments there.
__________________
hesperus is offline   Reply With Quote
Old 11-04-2015, 08:47 PM   #7
Thinks s/he gets paid by the post
MooreBonds's Avatar
 
Join Date: Aug 2004
Location: St. Louis
Posts: 2,091
Quote:
Originally Posted by Running_Man View Post
The non GAAP statistic of distributable Cash Flow should be ignored!!!
....which most REITs and MLPs use as a standard metric, and most investors and industry professionals also use as a standard reference for evaluating REITs and MLPs.

Quote:
Originally Posted by Running_Man View Post
With 2.173 billion average shares and $1.05 in dividends not covered by earnings ($1.48 -$0.43) you get a shortfall of $2.281 billion dollars. Add back the non cash write-off of assets for impairment of value of 489 million and you have $1.783 Billion in cash needed for dividends, which just happens to be the amount of debt they have added since 12/31/2014.
....and which also just happens to be just about exactly what they had in depreciation expenses ($1.725 B).



Quote:
Originally Posted by Running_Man View Post
So the 2 billion a year in additional debt to maintain the dividend appears to be the plan. For this plan to work in the long term the business would need to take off in profitability in order to cover the debt being added. Growing the debt at 5 percent per year increases the risk of this company with every year they continue to do this as earnings are falling and not rising. Wait for $20 if you really truly feel you want to invest in KMI
So I guess all of those projects they are in the middle of constructing, and the various other planned/future projects they talk about in their quarterly release are all financed by the money tree in Richard Kinder's back yard, and don't need any cash from KMI to pay everyone? They are completely unrelated to KMI's debt? I guess every time a REIT issues debt or takes out financing, it's just to send it out to shareholders, and has nothing to do with acquiring a property or another REIT.

Is KMI effected by low energy prices? Yes. Am I a little nervous with the market gyrations in my KMI holdings? Yes. But do I think it's some house of cards that is only sustained by issuing more debt that is magically turned right around and sent out the door to shareholders through some elaborate shell game? I guess if one thinks every REIT is a scheme that is about to fall apart because GAAP earnings isn't anywhere close to the dividend, then I guess KMI wouldn't make sense, either.
__________________
Dryer sheets Schmyer sheets
MooreBonds is offline   Reply With Quote
Old 11-05-2015, 09:06 AM   #8
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
Quote:
Originally Posted by MooreBonds View Post
....which most REITs and MLPs use as a standard metric, and most investors and industry professionals also use as a standard reference for evaluating REITs and MLPs.



....and which also just happens to be just about exactly what they had in depreciation expenses ($1.725 B).


Of course KMI is not a REIT nor an MLP, it is a C corp and pays taxes. The logic behind this change given by Kinder was that in order to take advantage of the boom in oil prices and natural gas it needed to not pay out all profits as MLP in order to fund capital projects for the great growth opportunities available. Budget for 2015 was for $70 WTI



So I guess all of those projects they are in the middle of constructing, and the various other planned/future projects they talk about in their quarterly release are all financed by the money tree in Richard Kinder's back yard, and don't need any cash from KMI to pay everyone? They are completely unrelated to KMI's debt? I guess every time a REIT issues debt or takes out financing, it's just to send it out to shareholders, and has nothing to do with acquiring a property or another REIT.

Is KMI effected by low energy prices? Yes. Am I a little nervous with the market gyrations in my KMI holdings? Yes. But do I think it's some house of cards that is only sustained by issuing more debt that is magically turned right around and sent out the door to shareholders through some elaborate shell game? I guess if one thinks every REIT is a scheme that is about to fall apart because GAAP earnings isn't anywhere close to the dividend, then I guess KMI wouldn't make sense, either.
Well you can look at the debt in one of two ways, either KMI is paying out all their earnings and additionally all available cash for dividends, leaving none for investing in their future and requiring borrowings, or they have no cash for dividends and borrow to make shareholders feel company has value. As most companies and particularly energy companies need investments to survive I do not expect a company to depend on borrowing for basic cap-ex after it is established as third largest company in it's field. Exxon mobil could easily borrow another $4.50 per share and increase the dividend to $7.50, would that make them a better investment?
Of course offsetting the 2 billion in new investments KMI made in 2015 KMI wrote off 500 million so far this year in prior year investments that weren't worth what they spent, forget about actually bringing additional corporate value or about 25% of current year investments. . As for the Richard Kinder money tree, I believe he realized he had picked all that fruit off his money tree a couple of years ago and he is merely playing 3 card monte with the remains of Kinder Morgan partnership, El Paso Pipeline Partners and the old KMI and hoped for a continued oil boom to restart the game. So far his game is borrow today tomorrow will be a better day.
__________________
Running_Man is offline   Reply With Quote
Old 11-05-2015, 10:08 AM   #9
Recycles dryer sheets
 
Join Date: Jul 2013
Posts: 189
Kinder Morgan: Lies, Damned Lies, And Statistics - Kinder Morgan, Inc. (NYSE:KMI) | Seeking Alpha


This guy explains it a lot better than I could. Yes they are a c-corp but they are still run like a MLP in as they have tax write offs for years in the future. If you don't understand how they operate that's fine don't buy. If oil prices don't go to 60+ I wouldn't own Exxon or KMI much longer. By the way I own both XOM and KMI.
__________________
alaska55 is offline   Reply With Quote
Another Nat Gas KMI Story
Old 11-05-2015, 10:03 PM   #10
Recycles dryer sheets
 
Join Date: Jul 2013
Posts: 189
Another Nat Gas KMI Story

The future of Kinder Morgan = NAT GAS

4 Things Kinder Morgan Inc. Wants You to Know About the Natural Gas Story -- The Motley Fool
__________________
alaska55 is offline   Reply With Quote
Old 11-05-2015, 10:36 PM   #11
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
Quote:
Based on my simple assessment of reliability of the company's distributable cash flow, dividend yield, dividend growth, organic growth prospects and risk factors, I put the fair value of shares at $37
The idea that KMI is being run as an MLP is absurd. It is being requested to be valued as an MLP but it is not one, MLP's pass on their depreciation and expenses to the unit holders to lessen paying taxes on distributions , C-Corps take depreciation as deduction from income. To state that we have a great new tax advantage in taking depreciation expense and that upon joining the companies together we are able to reduce the useful life of the assets increasing depreciation and "shocker" write off other assets yearly as not having value stated is not not not not not a reason to buy a stock.

Then add as a deduction from cash only "Sustaining Capital Projects" which is totally a management judgement call. Example: you replace a failing pipeline that needs to be replaced with a larger pipeline that will be able to handle growth planned for the next 10 years, which may or may not be realized is that sustaining capital because the pipeline was absolutely needed for present sales or growth because you spent more than needed for future growth capabilities, in most cases as these pipelines fail they are not sustaining capital. For 6 months ending 6/30/15 KMI spent 3.8 billion dollars on acquisitions and capital projects yet only 245 million of that amount is sustaining capital to maintain assets on a 40 billion dollar asset base? 1.4% of your asset basis annually is being sustaining? that implies a useful life on those assets of 70 years. Sustaining capital project expense and by connection distributable cash flow is the worst most useless statistic in the history of accounting.

What KMI has been doing is the same thing Valeant has been doing, keep borrowing growing and issuing and you can bury the lack of current profitability under reams of corporate financial measures designed for explaining growth they will supply you. Or perhaps Enterprise adjusted Ebitda for cost savings which are not yet obtained but are sure to be in the future and added to EBITDA is actually a good measure, I don't know but I know I would never invest that way.
__________________
Running_Man is offline   Reply With Quote
Old 11-06-2015, 08:24 AM   #12
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
Quote:
Originally Posted by alaska55 View Post
Should this natural gas boom occur as the bull case is stating it would be a big positive for KMI. The great boom in the petrochemical area is of course due to ZIRP and how many of them will come to fruition is the question but I would not want to hazard a guess here. I will point out it was only 2 years ago that Richard Kinder said that the shale oil boom would enable KMI to maintain at least a 10 percent per year dividend increase that they not have reduced to 6 percent due to declines in oil volumes. KMI of course needs a higher stock price for when they issue shares for these projects, it is a currency to use in place of debt if they can get investors to value the company high enough.

I think almost all of these benefits are offset by interest rate risk on the large debt, and any debt rating cut back stops the growth wheel that exposes the lower profitability of KMI than what the projections offer. At 25 today it is getting pretty close to the 20 I think it will fall to, but I think it will underperform in a recovery as well and I have grave doubts about the sustainability of dividend above 20 cents per quarter long term. Which is where at a price of 20 dollars you would get the 4 percent yield on the value of the dividend potential of the operation before debt mechanisms and stock offerings.
__________________
Running_Man is offline   Reply With Quote
Old 12-01-2015, 05:14 PM   #13
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
And so today nearly 6 months after Value Line downgraded the safety rating of Kinder Morgan, Moody's today said KMI is on watch for a possible downgrade to junk status on 44 billion in bonds. This resulted in the stock drop today.... and at 22.5 it is actually down 10% in one month since my previous post, showing that outsized losses are still very possible even on very beaten down stocks.
__________________
Running_Man is offline   Reply With Quote
Old 12-01-2015, 09:25 PM   #14
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,369
Quote:
Originally Posted by Running_Man View Post
And so today nearly 6 months after Value Line downgraded the safety rating of Kinder Morgan, Moody's today said KMI is on watch for a possible downgrade to junk status on 44 billion in bonds. This resulted in the stock drop today....

If I listened to everyone on the income forums that were all honking KMI's horn, I would have a very light wallet now. I am all about high dividends as that is all I own in preferreds, but I could never catch the KMI fever. And I am glad I didn't.


Sent from my iPad using Tapatalk
__________________
Mulligan is offline   Reply With Quote
Old 12-02-2015, 09:43 AM   #15
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,369
Runningman, have you seen KMI's continued sinking? Keeps taking on more water down 6% this morning alone.


Sent from my iPad using Tapatalk
__________________
Mulligan is offline   Reply With Quote
Old 12-03-2015, 10:46 AM   #16
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
Quote:
Originally Posted by Mulligan View Post
Runningman, have you seen KMI's continued sinking? Keeps taking on more water down 6% this morning alone.


Sent from my iPad using Tapatalk
Yes I did and this morning it has broken below $20.00 which is what I thought would happen when I originally started this thread. Avoiding stocks with major drops is critical when investing in individual stocks. When investing in income stocks it is important to avoid the overhyped in trouble companies. Value Lines safety rating frequently offers good value on early warning when a stock drops in safety in their rating as KMI did for 2 reasons:

1) The drop in rating is based strictly an objective mathematical criteria and not subject to objective judgements of analyst to adjust.

2) Value Line's safety ratings are not followed by very many and hence offers a good objective actionable change in the outlook for a company. Usually the safety rating drops happen to companies whose stock has already fallen some,as KMI had dropped to $40.40 at the point of the drop in rating from 44.40 a 10 percent decline but allowed one to avoid a much larger drop. It is key to then with the drop in safety to look with a critical eye of what the company is doing before buying back in.

At this point what is in KMI's price of 20? I think the following:

a) KMI needs 2-3 billion of borrowing if it is to keep dividend where it is as well as refinance 11 billion of debt coming due in next five years. This means about 20 billion to finance over the next 5 years.

b) If KMI intends to stay on their stated plan rating will be junk adding 1% to their interest rates most likely over the next 5 years, this means 200 million less in profits or 10 cents per share, an additional increase of 1 percent rise in interest rates cuts another 10 cents per share and also portends a cycle of increasing interest rate expense as we move forward through those 5 years. This will mean further downgrades as their leverage continues an upward trajectory unless their is a dramatic recovery in natural gas and oil.

c) Richard Kinder I am sure is aware of the issues and therefore it is far more likely that the dividend will be slashed to maintain the credit rating and they will agree the company as no longer an MLP, so called "distributable cash flow" as a measure will be dropped and actual cash flows will become the focus again. So a cut in the dividend to 20 cents per share per quarter saving 2.5 billion dollars is the most likely outcome. A cut to 10-15 cents per share would allow more financing wiggle room and is not out of the possibility of outcomes, this would mean a stock drop below 15.

d) I am not buying KMI but if I were based on the thought this is a valuable business I would be targeting 15 dollars per share at this point hoping for a rapid decline with year end tax loss selling. I think it is very unlikely KMI will go out of business but not entirely impossible either if economic conditions were to worsen. The more the stock drops the easier it is going to be for KMI to cut their dividend as it would have been priced in. At this point the board is probably worried about legal issues as they indicated for growth not cuts in the dividend. But if they do not cut their dividend then either the energy complex is exploding upwards or else the rating agencies will cut the KMI ratings and do the dirty work for them as capital markets will dry up for KMI.

e) The other possibility is sales of properties into the market at fire sales prices but that would no doubt involve "non-cash" losses on disposal. But that just continues to erode the balance sheet and seems a worse move to make in my opinion.
__________________
Running_Man is offline   Reply With Quote
Old 12-03-2015, 11:05 AM   #17
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,369
I am all about income investing. I kicked the tires a few months ago because the enticing yield. I also thought about an mutual fund basket of them, but who is to say many more in the basket are facing the exact same
problems? I cannot research in depth to figure that out. I will just stay in my preferred stocks for income as the ones I invest in are very easy to predict. I just do not have the stomach to gamble when I don't quite understand the known unknowns.


Sent from my iPad using Tapatalk
__________________
Mulligan is offline   Reply With Quote
Old 12-04-2015, 02:36 PM   #18
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,685
KMI today announced
Quote:
Oil and gas pipeline and infrastructure company Kinder Morgan Inc. (NYSE: KMI) said Friday that, after completing its 2016 budget process, it can confirm the company’s previous estimate for 6% to 10% dividend growth over its $2.00 per share target for 2015. The company said that its calculations indicate that Kinder Morgan will generate distributable cash flow of “slightly over” $5 billion in 2016.
Also in the coming days they will be reviewing their dividend policy with a goal of maintaining an investment grade credit rating. On this news the stock has fallen to about $17 per share. Fair value to me on a maintainable dividend annual basis of $0.60 to $0.80 per year is somewhere in the $10- $20 range depending on the growth outlook, valuing my expected maintainable dividend between 4-6% yield on the stock price. This would also place the PE of the company somewhere between 10 and 20 times earning depending on the following years volatility but I would expect earnings of $0.80 next year so at PE -18 you get $14.40 per share. So at about $15.00 per share you probably are picking up a fairly valued company with a 5 percent annual dividend.

See with accounting you can only mess with valuation criteria as long as people are willing to lend you billions at 3 per cent interest. At 10 per cent interest plans aren't quite as viable
__________________
Running_Man is offline   Reply With Quote
Old 12-04-2015, 06:19 PM   #19
Recycles dryer sheets
 
Join Date: Oct 2015
Location: Fairfield
Posts: 114
I have done extensive research on the MLP model and there is a big debate on free cash flow and distributable cash flow, which is net of cap ex. KMI though a corporation has MLP traits. The market does not know how to value MLPs, or corporations such as KMI. I had a 1% allocation in MLPs, took that to 2% in July and now 3% as of yesterday. I like MLPFX, Oppenheimer, but overlayed that with AMLP yesterday so I can trade it intraday. I own a tiny bit of KMI, some WMB, and SE in my 3% weighting. Still have a profit on WMB! The better names in midstream will not only be able to maintain their distributions, but increase them. I read the quarterly commentary after the close today from the Goldman MLP & infrastructure fund and though there is a greater dispersion in projected distribution rates from GPs, the confidence in the overall rate of increase is still there. Bottom line, MLPs and corporate entities like KMI are priced as if their business model is unsustainable and the reality is there is misinformation in the market place about coverage ratios as they relate to free cash flow/ distributable cash flow. There was a prominent article in September that MLPs with less than a 1 coverage ratio would need additional capital to maintain distributions. This is misinformation. The coverage ratios include capex, so MLPs can have less than a 1 ratio, and still be in excellent shape to maintain and even increase distributions without any capital market infusions. After the tax loss selling and margin induced selling abates, quality midstream MLPs and I suspect KMI will continue their distributions, and even increase them. When the market understands this, there will be a violent snap back rally. I can't think of a asset as mispriced as MLPs are today in my twenty five years on Wall Street. If you don't own MLPs, this is a golden opportunity as the price of oil has little to do with their ability to pay distributions in the midstream space.
__________________
StuckinCT is offline   Reply With Quote
KMI - On the road to disaster?
Old 12-04-2015, 07:22 PM   #20
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,369
KMI - On the road to disaster?

Stuck, A sincere question not a snarky one, as I am following this issue with interest, but am not qualified enough to dig deep into the financials, and only parrot what I read which seems heated on both sides....
If the company is so sound financially why does it have to tap the preferred market with a gaudy 9.75% yield? I know companies do not like giving money away and that yield is way past preferreds issued from totally junk crap companies. Why wouldn't they borrow through the bond market at a cheaper yield? Is the reason because they are tapped out in that arena? Bank loan covenant restrictions?
It appears to me from my very limited abilities that the market does know something, in relation to the current energy market environment.


Sent from my iPad using Tapatalk
__________________

__________________
Mulligan is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Cruise Disaster news not disiminated mickeyd Other topics 2 07-31-2007 08:22 PM
Financial Road Warriors - How to manage your portfolio while on the road Billy Life after FIRE 38 07-20-2007 04:44 PM
The need (?) for disaster hedging pedorrero FIRE and Money 23 04-10-2007 09:41 AM
GAO chief warns economic disaster frayne Other topics 1 10-28-2006 07:01 PM
Got my Free Frosty at Wendy's - A Disaster! Cut-Throat Other topics 18 05-16-2005 03:15 PM

 

 
All times are GMT -6. The time now is 05:42 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.