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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (42180)	9/20/2011 2:02:17 PM
From: E_K_S	Read Replies (1) of 78516

Gas Pipeline/Distribution Companies hitting All Time Highs - Over Valued or are the new domestic NG shale reserves starting to kick into the storage & distribution systems? I have been watching these NG pipeline, storage & distribution companies on every rally and have noticed that several are flirting with all time high levels. One or two of the companies I watch could be characterized as reaching high valuation levels (I would not buy them) but several others I see as fairly valued or even under valued. Here are a few companies from my GAS_Pipeline watch list: finance.yahoo.com NiSource Inc Common Stock(NYSE: NI) and CenterPoint Energy, Inc (Holdin(NYSE: CNP) are ones I sold because of valuation but are near all time highs. AGL Resources, Inc. Common Stoc(NYSE: AGL) and Atmos Energy Corporation Common(NYSE: ATO) are close to their all time highs but I still consider reasonable values. *These are some on my watch list that still seem like value buys in this sector: MDU, SEP, SE, TCLP:* finance.yahoo.com I sold SE at $19.50/share since their PE was above 14 but based on the recent run (and their business profile), at 15 PE they could be seen as undervalued. Sector Observation: As many of these companies begin to flirt with all time highs, could the market be signaling that several of these companies will benefit from the increased NG production from all of these new NG shale wells? It seems like the market is pricing in increased production of NG that will need to be processed, stored and transported in one or more of these pipeline networks. AGL and MDU seem to offer the best values and own some of the largest storage and distribution NG assets of the group. Of these two, MDU may offer the lowest valuation. I am still a buyer of shares below $20.00/share. EKS

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