Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

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Re: What did you buy? What might you buy? (2014)

Post by Spidey »

Here is Pembina's 3rd quarter report for anyone interested.

http://www.pembina.com/Pembina/media/Pe ... -FINAL.pdf

To me it looks like impressive year-over-year growth but I'm open to opinions, comments, criticisms. I don't know if 2015 will be stellar for earnings growth but that may be built into the stock price which is down almost 30% from the 52 week high.
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Re: What did you buy? What might you buy? (2014)

Post by AltaRed »

A quick scan shows they incurred costs for financial instruments so that would suggest some hedging of their NGL sales, but I have found no evidence of how much is covered or for how long. One would think that would be a key disclosure in their financials IF sales of NGL product is a material part of their business. I am somewhat interested in PPL myself but not until I understand their commodity exposure.

Added: I do see one footnote about $37 million in US NGL midstream sales in 3Q but that and of itself is somwhat meaningless without context.
Added2: I also see about 10% growth in outstanding shares each year, about half of which is DRIP'd share dilution.
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Re: What did you buy? What might you buy? (2014)

Post by Dudsy »

I'm having a hard time figuring out PPL's frac spread exposure.

They have a Sensitivity Analysis on p.92 of their 2013 annual report that shows a "Frac Spread" earnings impact of -$3million for every -$0.10 per gal change in Belvieu NGL pricing. However the same chart shows a positive $3million earnings impact from the same -$0.10/gal in their "Product Margin". I'm not sure if this implies no impact??

In a CIBC report after PPL's capital budget was announced a couple of weeks ago, they mention "Should WTI prices average $65/Bbl in 2015, we calculate an $84 million or 8% potential downward revision to our estimates"

That's all I can find so far.
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Re: Bought Deal Financing

Post by AltaRed »

Looks like these folks are the latest scumbags to dilute their shareholders with a $400M financing @ $30/share. Brings them all the way back to May 2013 share prices.

http://web.tmxmoney.com/article.php?new ... symbol=PPL

Added: Looking at it another way, they just raised circa $400M to help pay some $650M in dividends over the next 12 months... or is a dividend cut coming down the road too?
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Re: Bought Deal Financing

Post by 2 yen »

AltaRed wrote:Looks like these folks are the latest scumbags to dilute their shareholders with a $400M financing @ $30/share. Brings them all the way back to May 2013 share prices.

http://web.tmxmoney.com/article.php?new ... symbol=PPL

Added: Looking at it another way, they just raised circa $400M to help pay some $650M in dividends over the next 12 months... or is a dividend cut coming down the road too?
How much do you own?

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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by AltaRed »

None. Never saw sufficient attractiveness in it to own.
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by nisser »

I can't see why I'd ever want to own PPL over IPL.

PPL
Payout ratio: 125% since 2008. Currently 183%.
Forward P/E: 20

IPL
Payout ratio: 75-120% since 2006. Currently 120%
Forward P/E: 15

On top of that, a much higher proportion of IPLs cash flow is take or pay and not tied to commodity pricing.

Am I missing something?
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by 2 yen »

nisser wrote:I can't see why I'd ever want to own PPL over IPL.

PPL
Payout ratio: 125% since 2008. Currently 183%.
Forward P/E: 20

IPL
Payout ratio: 75-120% since 2006. Currently 120%
Forward P/E: 15

On top of that, a much higher proportion of IPLs cash flow is take or pay and not tied to commodity pricing.

Am I missing something?
How are these payout ratios calculated?

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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by nisser »

Just copy-pasting from Morningstar. Looks like they just use EPS and dividend per year to come up with it. I know someone's going to go down the "cashflow route" but to me that's just something people come up with to make valuation metrics less absurd.
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by AltaRed »

In all fairness, I would use EBITDA for dividend payout ratios near term, BUT I agree that without good earnings data, and ROE and EPS metrics over longer periods of time, companies running solely on cash flow multiples could be at greater risk of eventual implosion.
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by Peculiar_Investor »

Pembina's gone shopping ... Pembina and Veresen to Create Leading North American Energy Infrastructure Company
Under the terms of the arrangement agreement, Pembina is offering to acquire all the issued and outstanding shares of Veresen by way of a plan of arrangement under the Business Corporations Act (Alberta). The Transaction is valued at approximately $9.7 billion including the assumption of Veresen's debt (including subsidiary debt) and preferred shares.

Pembina is offering to acquire all of the outstanding Veresen common shares in exchange for either (i) 0.4287 of a common share of Pembina or (ii) $18.65 in cash, subject to pro-ration based on maximum share consideration of approximately 99.5 million Pembina common shares and maximum cash consideration of approximately $1.523 billion. Assuming full pro-ration, each Veresen shareholder would receive $4.8494 in cash and 0.3172 of a common share of Pembina for each Veresen common share. This offer represents a 21.8 percent premium to Veresen's 20 day weighted average price of $15.31 and a 22.5 percent premium to Veresen's closing share price of $15.23 on April 28, 2017.
Some commentary from the financial press, Calgary’s Pembina Pipeline to buy Veresen in $9.7-billion deal - The Globe and Mail and Pembina adds natgas infrastructure with C$9.7 billion Veresen buy | Business | Reuters (which is also posted on the Financial Post website, but I'm giving credit to the source).
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by 2 yen »

Has it really been this long since the last Pembina post? Assuming the bump today is because the sale price by Kinder Morgan was healthy. Or have I completely missed what's going on?

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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by AltaRed »

2 yen wrote: 09 Jan 2020 14:52 Has it really been this long since the last Pembina post? Assuming the bump today is because the sale price by Kinder Morgan was healthy. Or have I completely missed what's going on?

2 yen
I think because the overhang of that large KM holding has now been absorbed into the market. Pembina has also just issued $1B in unsecured notes to pay off some of its $2.5B in revolving credit facility which I suspect might be at either, or both of, shorter term and higher interest rate. Have not looked at the details.
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by 2 yen »

AltaRed wrote: 09 Jan 2020 16:13
2 yen wrote: 09 Jan 2020 14:52 Has it really been this long since the last Pembina post? Assuming the bump today is because the sale price by Kinder Morgan was healthy. Or have I completely missed what's going on?

2 yen
I think because the overhang of that large KM holding has now been absorbed into the market. Pembina has also just issued $1B in unsecured notes to pay off some of its $2.5B in revolving credit facility which I suspect might be at either, or both of, shorter term and higher interest rate. Have not looked at the details.
So, regarding the note, is this an expression of confidence in the company that the issuers allowed the note to happen?

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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by AltaRed »

These are unsecured notes stretching well beyond the 2024 maturity date of the revolving credit facility so perhaps they are relieved....? Obviously the syndicate of banks underwriting the unsecured notes feel/felt confident the unsecured notes are marketable.

That said, I don't think I'd be buying any of these unsecured notes maturing in 2028/2029 at coupon rates of ~4% or less.
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by Hogwild »

Paid by the Pipeline
A Canadian Energy Company Bought an Oregon Sheriff’s Unit

https://theintercept.com/2020/02/12/jor ... -pipeline/
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by Taggart »

Wed, 18 Mar 2020

Taking immediate and decisive action for investors

In light of the rapid and significant decline in global energy prices and uncertainty as to the duration of this downturn, Pembina has made the prudent decision to defer some of its previously announced expansion projects to reflect the current market reality. The following projects will be deferred:

Peace Pipeline Phase VII, VIII and IX expansions, representing $1.55 billion of total capital;
Empress Co-generation Facility, representing $120 million of capital;
Prince Rupert Terminal Expansion, representing $175 million of capital; and
Pembina's investment in the integrated propane dehydrogenation plant and polypropylene upgrading facility, representing $2.7 billion of capital, net to Pembina.
In addition to deferring capital spending on these major projects, additional discretionary capital spending has been removed from Pembina's 2020 capital budget.

The impact of these measures results in a reduction of $900 million to $1.1 billion, or approximately 40 to 50 percent, to the Company's previously announced 2020 capital budget of $2.3 billion. Pembina now expects its revised 2020 capital budget to be $1.2 billion to $1.4 billion. These spending reductions will be directed towards reducing Pembina's leverage and enhancing its financial position. Importantly, these measures will have no impact on Pembina's existing base business or its ability to continue to operate safely and reliably.

http://www.pembina.com/media-centre/new ... nid=135467
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by AltaRed »

I spent some time last night correlating that release with what they said in their last Investor presentation. I like the actions taken and I doubt it will cost them anything in forward cash flows. Some of their investments they chose to defer for a year perhaps were likely ahead of their time, i.e. too aggressive in schedule.

The primary thing that bothers me in the PPL suite of projects is the Jordan Cove LNG project. I think they should just let this one die on the vine. Even with today's FERC approval, the state itself seems hostile towards it. That is an uphill battle that may not worth fighting.
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

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AltaRed wrote: 19 Mar 2020 15:46 I spent some time last night correlating that release with what they said in their last Investor presentation. I like the actions taken and I doubt it will cost them anything in forward cash flows. Some of their investments they chose to defer for a year perhaps were likely ahead of their time, i.e. too aggressive in schedule.

The primary thing that bothers me in the PPL suite of projects is the Jordan Cove LNG project. I think they should just let this one die on the vine. Even with today's FERC approval, the state itself seems hostile towards it. That is an uphill battle that may not worth fighting.
The fact that you do the deeper work on looking at these types of issues makes you an absolutely invaluable member of this forum. Just sayin'.

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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by AltaRed »

I actually don't dig too deep, certainly nothing like P_I does for analysis. I tend to look more macro at the bigger pieces to see how they fit together and if they make sense.
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by Shakespeare »

Up 36% in one day! :shock:
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by 2 yen »

Shakespeare wrote: 24 Mar 2020 16:28 Up 36% in one day! :shock:
Someone maybe knows something we don't.

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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by AltaRed »

2 yen wrote: 24 Mar 2020 16:31
Shakespeare wrote: 24 Mar 2020 16:28 Up 36% in one day! :shock:
Someone maybe knows something we don't.

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How about having been way oversold?
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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by 2 yen »

AltaRed wrote: 24 Mar 2020 16:45
2 yen wrote: 24 Mar 2020 16:31
Shakespeare wrote: 24 Mar 2020 16:28 Up 36% in one day! :shock:
Someone maybe knows something we don't.

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How about having been way oversold?
Perhaps. I wonder what oversold actually means in a panic environment?

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Re: Pembina Pipeline Corp (Symbol PPL-T) (formerly PIF.UN)

Post by AltaRed »

The description within oversold bounce might be useful.
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