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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: yossarian67 who wrote (97141)	2/23/2008 11:20:47 PM
From: seriousinvestor	Read Replies (1) \| Respond to of 206209

According to a recent Lehman report all of the '07 PIPES were registered in January '08. Of course, I don't think anyone can really figure out how many of the 10+M shares have been sold. Based on the recent volume is not possible that they all were sold. On the other hand, you don't know how many shares are held by investors who don't want to sell at anything close to current price. At the current price and assuming the current distribution is maintained, the yield is just under 12%(approximately 70% of which is tax deferred). I personally can't imagine it going meaningfully lower especially in an environment where interest rates in general are dropping and NG prices are higher than they have been in more than a year. I think a very significant portion of '08s production is already hedged so we are not like to gain much from the recent rise(but it also is highly unlikely that the recently increased distribution would be decreased) but a smaller portion of '09 is now hedged so CEP should have increased income in that year. While I like CGs as much as anybody,if I get a constant $2.25 per annum with an occasional bump at least equal to the inflation rate and 70% or so of that distribution is tax deferred I will be very happy with my investment. Can anyone suggest another investment that would get me anywhere near that after tax yield with roughly comparable risk? The initial IPO was at a much lower yield. I can't imagine the yield staying at 12% over the long run and I seriously doubt there will be any additional PIPES transactions since they uniformly were a disaster for the purchasers.. Of course, I don't know if we have reached bottom but if you look at LINE it started last week at under $19(an all time low) but a few days later was almost $22. I bought my position around $20 when I thought the bleeding was over(with hindsight I should have waited a few days but it's pretty hard to pick a bottom) and if the stock goes to $30 as I expect it really won't matter. I think in a few months you will be able to say the same thing about CEP.

To: yossarian67 who wrote (97141)	2/24/2008 6:46:57 PM
From: Ed Ajootian	Read Replies (2) \| Respond to of 206209

yossarian/serious, Constellation Energy Partners (CEP) -- I see that seriousinvestor answered your question and also offered some great insight regarding the undervaluation of the current stock price. As of Friday's close, CEP took over the lead from LINE as being the MLP/LLC sporting the highest current yield, about 11.8%. Just to add some more thoughts, I believe one reason that the stock is getting pounded is that even per the company's own '08 guidance (see the powerpoint presentation that was given in connection with their 4Q earnings call), they will have trouble maintaining the distribution rate without borrowing more funds, unless natty prices go up from here. I believe natty prices still have more to go up so I am holding my position in CEP for now, but given the relatively low margin for error I am not planning to buy any more of it, at least for now.