Replies to post #9198 on The Rising Influence of Rising Affluence

[mr_o]

PAGP: This is a valuation call for me. PAGP is the general partner of PAA and is slated to grow at 21% in 2015, the growth rate increases to 26% if their current deal goes through (no reason it wouldn't as of now). Combing through the information graciously provided to the public here MLP Data Sheet
shows that within the comparable GP sub-sector PAGP is undervalued. The current yield on PAGP is 2.93%, where other GP's have a lower yield with similar growth rates. WGP at 1.86%, ENLC at 2.5% and TRGP at 2.57%. The difference seems small but I think it is significant enough to move PAGP back into the 2.5% range common of it's peers. Currently to get back to par (if we call par 2.5%) PAGP has a 17% upside and a 26% growth rate for 2015. The weakness started a few weeks ago when a secondary share offering occurred, though the market didn't seem to care that no new shares were issued, just shares own by a different company to raise funds for the current deal. Hope that makes some sense, if not please ask. I think this is the first time I've ever posted analysis of my own.

[mr_o]

ENLK: Doubling in size by 2017

My basis for owning ENLK is simple and longer term. ENLK has stated the company will double in size by 2017. Will share price double with it? Probably not quite, but some market cap expansion should occur (hopefully not to much by way of offerings). Ill happily collect 5% on a company that will grow that much in 3-4 years. ENLK is 51% owned by Devon and the growth will be supported by that relationship. Also ENLK is 95% fee based with inflation adjustments in place if needed, providing a large amount of stability and inflation protection.

Best of luck

P.S. ENLK had a share offering very recently, so that threat is off the table for the near future.