As a long-time holder of SIMO, and now you're selling at least some, I'll take that as clue for me to get out of my tracking postion. I'm out a/o this morning.
Put the proceeds into NGL if you don't mind the K-1. I think it's going to be a super winner over the next 2-3 years, and then will reassess.
It almost went bust a year ago, but it changed it's mind and decided not to go bust. It will take about a year or 18 months to "fix" the balance sheet (they need to refinance debt, push out maturities, and then figure out what to do with about $920m of floating rate preferred stock), and once the balance sheet is stabilized, it should be a normal slow growing energy business paying a decent distribution.
That sounds like a lot, but they've got plenty of free cash flows from their business to do it all, so once it's done I think the unit price will be closer to $10 than $4. It will take 18-24 months (three years max) to get there, but that's not a bad wait for a 150% gain which then begins paying distributions. |
