Back in 2020... mid-streamers got hammered with other energy stocks, creating some nice buying opportunities in what proved to be a short lived contraction in energy...
But the event in 2020 wasn't "sudden" for energy issues, which had been struggling and moving lower for quite a while already...
I've noted it before... the theme in cutting the distribution to shed debt... creating opportunities for those few for whom patience and delayed gratification isn't a big issue...
HMLP is in that focus, now... if with some uncontrolled risks still to face down first... and then probably 3 years or so from this December, if they manage to get past refi issues... to keep bumping along and being boring while paying down debt faster, before the moves made pay off...
Both GTE and CDEV are participants in that same type of trade... on the producer side..
OMP / OAS was my pick of the 2020 mid-streamers... and it has done and is doing will... as is parent OAS after the restructuring...
But, as I noted... there are still some out there that were over-extended, even before the events of 2020... that might still have a long road to putting the wheels back on the plan they'd had...
Here's a view of one of those... seen from the view point of a Seeking Alpha article giving them some advice, all the way back in December of 2017:
Martin Midstream Partners Should Cut The Distribution
The advice looks pretty good in hind sight... and cut the payout they did... from $0.81 to $0.50 in Dec 2016, and again down to $0.25 in April of 2019 (only a year and a half after the article linked above... coincident with the one below)...
Why Units of Martin Midstream Partners Are Cratering Today
And then, they cut it again dow to $0.06 in Feb 2020... and finally down to $0.01... in August of 2020...
Now, two and a half years later... the debt is still an issue... but, with the distribution at $0.02 and the yield at 0.63%... they should be making more progress than it seems they are in shedding the debt problem... ?
They're still reporting losses... and the income they are reporting is wildly skewed to "sulfur services" versus NGL butane, and fertilizer operations, or transportation... which generates some pretty major questions about "what happened"... and "where is all the $ going" ? The payout... used to be $0.81 ?
The shares dropped from $42 to $13 in 2008... and they raised the payout ?
Something here just isn't adding up...
Either they've been forced to shed a huge pile of assets somewhere along the line... or they've done some other really stupid deal with the bankers to prevent the cash from paying down the debt... ???
Either way... it will take some work to figure out what's gone wrong here.... but SOMETHING is wrong...
This looks like... a badly managed business... that allowed the wheels to come off... and can't put them back on... even thought the businesses they are in are absolutely booming... NGL, fertilizer, and lubricants... are off the charts... they own pipelines... went deeply into debt to buy them... but now make no money from them ?
June 2019: Martin Midstream sells storage assets in $215M deal
They have "re-focused on refinery services"... ???
Rather than paying down debt to grow the value... they've been paying down capital... and the value has continued shrinking... so, this is NOT a story about paying down debt and restoring the distribution...
I see very little reason to expect this company to change course...
Steer clear...
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