Just got this notice from Benzinga (News service) regarding an update from Citigroup.
They maintain their positive position regarding ALDW. However, they've raised their target valuation as follows:
DJ Alon USA Partners Price Target Raised to $14.00/Share From $12.00 by Citigroup
It works out to about 17% more than previously expected. However, we investors here will want to consider the ramifications of their upgraded prospects as it represents a leap of faith from the current $10.95 to an additional $3.05.
If you have a sizable position, you're likely looking at a very sizable gain in the wings. My friends and I on this board should not be surprised by Citigroup's action. If anything, I'm a bit surprised that it comes now as opposed to a month or so ago. This move today is probably tied in with the obvious---guidance will be coming within the next couple of weeks at which time we will know how the second quarter has been for ALDW and also, of course, the distribution that will have been set by the BOD.
I stated last week that I'll be happy with 25 cents, well down from the previous quarter's 38 cents. I dropped my expectation in light of the downward pressure brought to bear due to the advancing expense of RINs which now rival their cost shortly after MR. Trump took office. Thus it is, regrettably, that I believe it would be prudent to accept their bottom line will have been impacted significantly at the expense of distributable cash flow (DCF). Distributions come directly out of DCF.
From today's price (at 1:40 C) of $10.94, $14 seems very far away. It amounts to a gain of 28%. That is very substantial. This may well be the last opportunity an investor has to add ALDW at extremely low cost. I completed my positions last week, bringing my total holdings of this particular stock to 25,000 units. I sensed time was running out for those of us determined to complete our holdings in this pick and paid almost $11 last week, considerably more than I'd expected to be paying. I'm glad I did, though, as I no longer have to play the guessing games and wonder about my difficulty in making decisions at times. And now, with the upgrade in terms of valuation and price target, I think it's a safe enough bet that we're going to find appreciable gains in ALDW within the next few days.
Good fortune, everybody!
