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Posted On: 04/17/2017 6:25:00 PM
Post# of 2218
$SUN . Sunoco LP (NYSE: SUN
Sunoco units were trading down enough to lift its distribution yield to 14%. When energy partnerships find their units priced to offer such tempting distribution yields, one takeaway is clear to the battle-worn investor: The unit price is dropping because investors are bracing for a distribution cut.
Equity Transfer Equity (NYSE: ETE), Sunoco’s sponsor and general partner, was the most mitigating of the mitigating factors. Equity Transfer has deferred claiming any incentive distribution rights since the second half of 2015. The deferment has freed hundreds of millions of dollars that Sunoco has used to support the distribution. Equity Transfer contributed an additional $300 million to Sunoco’s cause by investing in a preferred equity private placement in February.
Sunoco units were trading down enough to lift its distribution yield to 14%. When energy partnerships find their units priced to offer such tempting distribution yields, one takeaway is clear to the battle-worn investor: The unit price is dropping because investors are bracing for a distribution cut.
Equity Transfer Equity (NYSE: ETE), Sunoco’s sponsor and general partner, was the most mitigating of the mitigating factors. Equity Transfer has deferred claiming any incentive distribution rights since the second half of 2015. The deferment has freed hundreds of millions of dollars that Sunoco has used to support the distribution. Equity Transfer contributed an additional $300 million to Sunoco’s cause by investing in a preferred equity private placement in February.
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