Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

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Thegipper
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Thegipper » 11 Aug 2017 21:22

newin96 wrote:
11 Aug 2017 20:37
If they truly are being dragged down because of ETF related energy groupings, and the fundamentals remained solid it would be a buying opportunity - is this a chink in the efficient market hypothesis brought on by the emergence of ETFs?

As an aside I'm not proud of my run-on sentence.... :roll:
That's okay. I do that all the time and I was a product of the public education system. I don't like the language cops . The language cops like using this technique when they want to change the discussion.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by IdOp » 11 Aug 2017 23:11

If there is a problem with energy grouping, that's really a problem with the slice-and-dice sector sprawl that ETFs have morphed towards, and it's reflective of active management as opposed to total market indexing.

I disagree that the EMH was brought on by ETFs, it was there long before ETFs showed up. And, Sharpe's arithmetic does not rely on EMH either.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Thegipper » 12 Aug 2017 09:04

IdOp wrote:
11 Aug 2017 23:11
If there is a problem with energy grouping, that's really a problem with the slice-and-dice sector sprawl that ETFs have morphed towards, and it's reflective of active management as opposed to total market indexing.

I disagree that the EMH was brought on by ETFs, it was there long before ETFs showed up. And, Sharpe's arithmetic does not rely on EMH either.
The oil ands sector has a bad day Enbridge and other pipelines have a bad day. Coincidence ? If they were not lumped in as energy companies and were put in with transportation, industrials or utilities I believe this tendency would be mitigated. I have avoided oil nd gas stocks for at least 4 years. I have owned Enbridge and just seems to track oil and gas. It shouldn't because it basically transports a product for a toll or shipping charges. Not unlike CN or CP.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by IdOp » 12 Aug 2017 15:37

Thegipper wrote:
12 Aug 2017 09:04

The oil ands sector has a bad day Enbridge and other pipelines have a bad day. Coincidence ? If they were not lumped in as energy companies and were put in with transportation, industrials or utilities I believe this tendency would be mitigated. I have avoided oil nd gas stocks for at least 4 years. I have owned Enbridge and just seems to track oil and gas. It shouldn't because it basically transports a product for a toll or shipping charges. Not unlike CN or CP.
Well, IPL's earnings came out Thursday, so maybe the market (for pipelines) was reacting to that as well.

But that aside, I wasn't actually trying to disagree with you, maybe there is some inappropriate categorization there. I was trying to say that the existence of these sector ETFs and the actions of those who (perhaps sometimes indiscriminately) buy and then dump them are the result of active management and the sales machine. These things to me are the "bad part of ETFs", but don't apply to all ETFs. Upon re-reading newin96's post I think now he was trying to point out a possible inefficiency mechanism related to some ETFs only. At first I had read "the emergence of ETFs" as referring to the early ones which tended to be broad-market ETFs. That was probably my fault for not reading carefully enough. :oops:

To help cure the off-topic I created, my IPL story is that I bought some in late 2015 around Friday's price. I do recall when I bought it IPL seemed to have pretty good dividend coverage (low payout) so that swung me towards it. It went all the way up to $30 and now it's back here again. Maybe it's a buying opportunity again, but sometimes these downdrafts have follow-through, so who knows. Rising rates might not be so kind to the sector either. Think I'll watch and wait a bit before deciding to buy any more.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Londoncalling » 12 Aug 2017 18:05

I have been a relatively long time holder of IPL (5 +years) at a price of $16.xx. At the time of purchase it was in the high 6% distribution range as IPL.UN. It has treated me well with growing dividends and share price appreciation. I even trimmed a few years ago in the mid 20s. I am still over weight. Am I interested in buying after such a huge pullback? yes. will I act on that interest. not likely. I am overweight the stock but feel it is oversold. However, what do I know it could stay low for quite some time or fall even further on a full market correction. That being said sometimes I get silly and make an swing trade.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Taggart » 01 Oct 2017 05:22

IPL has performed well in my portfolio this past month, so perhaps things are looking up.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by 2 yen » 01 Oct 2017 08:45

Taggart wrote:
01 Oct 2017 05:22
IPL has performed well in my portfolio this past month, so perhaps things are looking up.
Oil has gone up a bit, so maybe people are feeling better. My take on these companies (IPL, KEY, PIF, etc.) is that disruption will affect them to some degree. Since the jury is out on when and to what degree, I am not buying more of any of them. In doubtful moments, I tell myself that the non-internal combustion engine fossil fuel derivatives will remain in great demand and perhaps increase quite a bit, so I should be careful going whole hog and selling all non-renewables.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by nisser » 01 Oct 2017 11:45

The major reason IPL is down is because they are plannign to divest 3b+ into some sort of plastics factory. It may be a great thing or 3billion down the drain.
I have quite a bit of it a cost of ~22-23$. I think if you've thought about getting some oil exposure nearly 4 years into this downturn is probably a good time to start dipping your toes into it.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by AltaRed » 01 Oct 2017 12:33

With the NDP gov't looking to add jobs by building petro-chemical facilities, both PPL and IPL have developed proposals to produce polypropylene in Strathcona County, AB primarily for export. PPL has a Kuwati partner. It appears IPL may be going it alone.

https://www.pressreader.com/canada/calg ... 8319675270

I don't think much of politically subsidized facilities to make the economics work and betting the farm on cheap feedstock. Without continued subsidization by the AB gov't, there is no way AB based petro-chemicals can be competitive with huge US (and Middle East) facilities on tidewater. The only way Novacor did it (near Red Deer) is through huge subsidies and gov't mandated feedstock circa Peter Lougheed in the '70s (I think). I would NOT be betting on these being long term double digit ROE/ROCE returns.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by schmuck » 01 Oct 2017 13:40

BMO Capital raised IPL to outperform a week ago with a target price $27.
BMO said its rating is based on above-average div yield of 7%, premium long life assets with high-credit counterparties, significant optionality in intra-Alberta oil sands projects and the attractive valuation.
BMO still expects cash flow per share of $2.47 for 2017, $2.40 for 2018, and $2.45 for 2019.

That said, I took the opportunity to trim my position Friday morning when it hit $26 plus. I've held it for about 15 years and it will remain a core position. With a substantial holding of TRP, along with some PPL and a bit of ALA, I had been thinking of reducing my overall pipeline exposure for some time.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by AltaRed » 01 Oct 2017 14:43

I agree BMO is directionally right when looking at IPL's existing business, albeit I believe they are over optimistic on optionality in the AB oil sands business. I don't think a $3B investment in Notley's petro-chemical dream will be all that rewarding to shareholders.
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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by Dudsy » 01 Oct 2017 16:28

Taggart wrote:
01 Oct 2017 05:22
IPL has performed well in my portfolio this past month, so perhaps things are looking up.
I watch propane/butane prices; they're up 70 - 80% over last year and have been since early August. IPL should have a very good quarter. I bought IPL around a month ago; I couldn't understand the aggressive selling from Aug all the way up to mid-Sept. Was it interest rate concern's?

IPL has touted their commodity 'de-risking', which indeed was true up until last year... however, less so now with the Williams acquisition. NGL's are a volatile business so this is not a buy and hold stock for me.

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Re: Inter Pipeline Ltd (Symbol-IPL) (formerly IPL.UN)

Post by AltaRed » 01 Oct 2017 17:16

I agree the mid-stream is highly volatile due to the highly variable input cost (feedstock) and product prices. Margins can be all over the map. Money can be made but the business is harrowing and life shortening. I was assigned to the gas and gas liquids marketing business for awhiie in my career (albeit a century ago) and I was happy to get out of it when I could. Which is why I liked it when ALA got out of the commodity business and stuck strictly to COS (cost of service). I'd suggest IPL ownership is becoming a trade, rather than a buy and hold investment.
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