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Non-Tech : Income Investing -- Ignore unavailable to you. Want to Upgrade?

To: maverick61 who wrote (49136)	1/18/2023 5:57:23 PM
From: the traveler	Respond to of 52119

To: maverick61 who wrote (49136)	1/18/2023 6:57:59 PM
From: Elroy	Read Replies (1) \| Respond to of 52119

Re: Since UAN is a variable distribution MLP, it is going to pay unit ow 5/3/22: Fertilizer prices are up from the prices realized in Q1.Volumes sold should increase in Q2 since Q2 is "planting season".UAN easily pays more than $10 and perhaps as high as $20 per unit in Q2. UAN paid $2.26 in Q2 at the end of May. The payment in May 2022 was the Q1 quarter results payment. When I said they will pay $10 to $20 in Q2 I meant (but perhaps did not make clear) that the payment FOR Q2 (which is received in Q3) would be that amount. The Q3 distribution (which is determined by Q2 financial performance) was $10 give, paid in Aug 2022. It was never expected than UAN would pay $10-$20 in the Q1 distribution last year (which was paid in Q2). So sorry for not being more clear. UAN's previous four quarterly distributions are about $1.70, $10, $2.25 and $5.00. However, each of those quarters other than the $10 quarter have something "one time" reducing distributions. From here out, the known "one time" items (debt repurchase, unit repurchase, plant closure due to turnaround) are finished. Thus the free cash flows from operations will be paid to unit owners, and the amount is likely going to be $30-$45 in 2023. The modeling shows the high end of that range. i'd love to discuss the forecast in detail with you if you have the time. 8/23/22 - I think by January 2023 UAN is easily $150 or more, maybe $200, and it will pay $40 or more in calendar year 2023. It seems highly undervalued today to me.UAN is now trading at $102 and paid $1.770 in Q4 at the end of November. BIG MISS Agreed! The weak share performance is confusing to me. I still think it's going to pay out roughly $40 in 2023 (maybe $35, maybe $45). Thus, I'm confused by the weak share price today. The distributions outlook ($35 or so in 2023) is easy to defend. The unit price is up to others, evidently they disagree with me. Given that UAN is going to pay about $40 in 2023, and we don't know where the fertilizer industry is going in 2024, a unit price of $150-$200 per unit seems appropriate to me. Then, and today. But the unit price isn't doing what I expected. It's harder for the distributions to not do what I expect because we have a good idea on tonnage UAN can produce and sell, and a good idea on the pricesper ton that UAN will realize, and so without unexpected "one time expenses" the money has to flow through the income statement, to us. I will say this - UAN is the safest equity I've ever seen that is about to yield 33% in the coming year. They will pay out big money, and they will not go bust (as one would expect of a stock yielding 33%). ------ Here's my model for Q4 results - the lack of "one time charges" makes a large distribution (about $10) highly likely. But....we never know until they report. UAN is the stock ticker, and also one of the two fertilizers that UAN sells...... UAN price per ton $466, volume sold 295k, = $137 million Ammonia price per ton $900, volume sold 100k = $90 million Urea = $7 million Fertilizer sales = $234m Shipping and Other = $12m Revenues = $246m Direct Costs = -$75m (guidance $60m-$70m, guidance excludes changes in inventory) Cost of Materials = -$42m EBITDA = $129m Interest Expense = -$7m Maintenance Cap Ex = -$8m Reserve for 2024 Turnaround = -$2m Cash Available for Distributions = $112m Distribution = $10.64