KMP

Energy Transfer Partners’ Solid Distribution Coverage Ratio

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By Brian Nelson, CFA We understand that to many dividend growth investors the dividend/distribution isn’t everything–it is the only thing. That’s why we spend a considerable amount of time assessing the health and growth potential of dividends/distributions. To us, a master limited partnership’s (MLP) distribution is inherently risky. One of my former colleagues at Morningstar, Jason Stevens, emphasized in an April 2013 research piece on the group what Valuentum has been telling investors for a while: Another implication of MLP distribution policies that is important to understand is the impact of high distribution payouts on MLPs’ capital spending. Unlike corporations, which can use retained earnings and excess cash for growth purposes, MLPs retain very little of the cash generated each … Read more

Dividend Increases for the Week Ending July 18

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Below we provide a list of firms that raised their dividends during the week ending July 18. The dividend reports of covered firms on this list will be updated shortly with the new information. To access our dividend reports use the ‘Symbol’ search box in our website header. Firms Raising Their Dividends This Week Bassett Furniture (BSET): now $0.08 per share quarterly dividend, was $0.06. CIT Group (CIT): now $0.15 per share quarterly dividend, was $0.10. Education Realty Trust (EDR): now $0.12 per share quarterly dividend, was $0.11. Fidelity Southern (LION): now $0.09 per share quarterly dividend, was $0.08. Goodyear (GT): now $0.06 per share quarterly dividend, was $0.05. Greene County Bancorp (GCBC): now $0.18 per share quarterly dividend, was … Read more

Valuentum Economic Castleâ„¢ Rating Update

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Read: Keeping the Horse Before the Cart: Valuentum’s Economic Castle™ Rating The Economic Castle Focuses on the Magnitude of Economic Value Creation The Valuentum Economic Castle™ rating is an enhancement of the competitive advantage framework (commonly known as economic moat analysis) that has become widespread and ubiquitous within the investing world. Whereas an economic moat framework evaluates a firm on the basis of the sustainability and durability of its competitive advantages, Valuentum’s Economic Castle™ rating evaluates a firm on the basis of the firm’s future economic profit spread (return on invested capital less its weighted average cost of capital). The companies with the strongest Valuentum Economic Castle™ ratings are poised to generate the most economic value for shareholders in the … Read more

5 Minutes with Valuentum’s Brian Nelson

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Valuentum: Brian, thanks for joining us today. Nelson: It’s my pleasure. Valuentum: So the markets continue to make all-time highs. What are you telling investors? Nelson: That depends. If you’re going to be in the market for more than 10 years, then you don’t have much to worry about. For long-term investors that are decades away from retirement and have absolutely no liquidity or income needs from their investments, one particular event resonates in my mind as to why they should have a full risk allocation to stocks. That event is the stock-market recovery from the Financial Crisis of 2008-2009 — which is the worst financial event of our generation. In just 5 or so years after the credit crunch, … Read more

Earnings from 15 Dividend Growth Giants

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History has revealed that the best performing stocks during the previous decades have been those that shelled out ever-increasing cash to shareholders in the form of dividends. In a recent study, S&P 500 stocks that initiated dividends or grew them over time registered roughly a 9.6% annualized return since 1972 (through 2010), while stocks that did not pay out dividends or cut them performed poorly over the same time period. Such analysis is difficult to ignore, and we believe investors may be well-rewarded in future periods by finding the best dividend-growth stocks out there. Let’s take a look at the recent performance of 15 high dividend payers and disclose their ‘valuation ratings’ and most recent Valuentum Dividend Cushion scores. Valuentum … Read more

Dividend Increases for the Week Ending April 18

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Below we provide a list of firms that raised their dividends during the week ending April 18. The dividend reports of covered firms on this list will be updated shortly with the new information. To access our dividend reports use the ‘Symbol’ search box in our website header. Firms Raising Their Dividends This Week CSX (CSX): now $0.16 per share quarterly dividend, was $0.15. Discover Financial Services (DFS): now $0.24 per share quarterly dividend, was $0.20. Donegal Group, Inc. (DGICA): now $0.1315 per share quarterly dividend, was $0.1275. Kinder Morgan (KMI): now $0.42 per share quarterly dividend, was $0.41. Kinder Morgan Energy Partners (KMP): now $1.38 per share quarterly dividend, was $1.36. LyondellBasell Industries (LYB): now $0.70 per share quarterly … Read more

EXCLUSIVE ALERT: Addressing Kinder Morgan Energy Partners and the MLPs in General

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There’s one thing for sure about Valuentum: as a member, you get the truth, the whole truth, and nothing but the truth. That’s why our members love us! We’re completely independent and completely tied to your best financial interests. You know we’ve never been shy about outlining the risks related to MLPs – for one, you don’t have to look far to see this warning (source) on the front page of every one of their 16-page reports (at the bottom): Firms in the oil and gas pipeline industry own or operate thousands of miles of pipelines and terminals—assets that are nearly impossible/uneconomical to replicate. Most companies act as a toll road and receive a fee for transporting natural gas, crude … Read more

Boardwalk Pipeline Highlights Unique Risks of MLPs

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You can’t get far researching master limited partnerships (MLPs) on Valuentum’s website without encountering the following warning (source): Firms in the oil and gas pipeline industry own or operate thousands of miles of pipelines and terminals—assets that are nearly impossible/uneconomical to replicate. Most companies act as a toll road and receive a fee for transporting natural gas, crude oil and other refined products (and generally avoid commodity price risk). Though there is much to like, most constituents operate as master limited partnerships and pay out hefty distributions that can stretch their balance sheets. Additional unit issuance (dilution) has become common, and capital-market dependence is a key risk. We’re neutral on the group. We have a unique view of the business … Read more

The Best Ideas for 2014 and Beyond: Part II

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A portion of this article is excerpted from the January 2014 edition of the Dividend Growth Newsletter. Valuentum has two actively-managed portfolios: a Best Ideas portfolio and a Dividend Growth portfolio. Each portfolio has different goals and strategies. The Best Ideas portfolio seeks to find firms that have good value and good momentum characteristics and typically holds them from a Valuentum Buying Index rating of a 9 or 10 to a rating of a 1 or 2. The goal of the portfolio is to generate a positive return each year and to exceed the performance of a broad market benchmark. The Dividend Growth portfolio seeks to find underpriced dividend growth gems that generate phenomenal levels of cash flow and have … Read more