backyard gas grill Find 8% Yields For 5 Years In Ferrellgas Partners LP Bonds, Rated B3/B-, Matures June 2020

by:Longzhao BBQ     2019-10-16
backyard gas grill Find 8% Yields For 5 Years In Ferrellgas Partners LP Bonds, Rated B3/B-, Matures June 2020
This week's bond review focused on a propane dealer who recently added revenue by acquiring the midstream oil and gas industry.Ferrelgas Partners LP (NYSE: FGP) is one of the largest propane dealers in the United States, although propane is its core source of revenue for the past 14 months, it acquired two companies that served the midstream oil and gas industry.Not only are these strategic acquisitions beginning to provide a diverse source of revenue, but the recent acquisition of Bridger Logistics has also increased immediately, leading to the firstIncrease quarterly dividends for shareholders of this MLP.Its last fiscal year report showed that total revenue increased by 21% over the previous year, between fiscal 20122014, EBITDA increased by nearly 50% after adjustment.While oil prices fell from more than $100 a barrel to the nearest $40 a barrel, Ferrellgas continues to grow.Couponed at 8.65%, the price is slightly higher than the face value, we believe that these relatively short 58-month bonds bring good cash flow to income investors and maintain about 8% with a company that continues to grow in revenue and market shareSo we take these Ferrellgas partner bonds as our global highRevenue management earnings portfolio for FX1 and fx2.At present, the propane industry consists of several large companies and many small companies, most of which are small regional suppliers.Today, Ferrellgas is the second largest propane distributor in the United States and has operations in all 50 states.In addition to what most people think is used, propane has a wide range of uses-Backyard BBQ and portable stove.More than 660,000 farmers use propane for irrigation pumps, grain dryers, backup generators and other farm equipment.It is an essential fuel for crop drying, flame cultivation, fruit ripening, space and hot water, and food refrigeration.In addition, more than 9 million families across the country use propane on stoves, water heaters, stoves, outdoor grills, fireplaces, generators and other appliances every day.Business owners across the country are also choosing this cleanBurn fuel for buses, taxis, delivery and other fleets to minimize air pollution in the metropolitan area.Ferrellgas has established an extensive distribution network to serve all these consumer groups.About issuerferllgas is a leading U.S.Propane and propane dealersRelated equipment.Headquartered in KS's Land Park, the company currently employs nearly 4000 employees nationwide.The company also provides oil and gas midstream services to major U.S. energy companies.The company's core business of providing and distributing propane serves industrial/commercial, portable tank exchange, agriculture, Wholesale and other customer services in all 50 states, the District of Colombia and Puerto Rico.The company also obtains sales from portable tank exchanges of national brands through an independent and cooperative network --Have distribution outlets.Its residential and agricultural customers usually live in rural areas, while its Industrial/Commercial and tank exchange customers usually live in more urban areas.In May 2014, Ferrellgas began diversifying revenue sources by acquiring Sable Environmental, a service provider in the midstream oil and gas industry.Later, when they acquired Texas in June 2015, they made another diversified acquisition --Another integrated midstream service provider, Bridger Logistics.In the process of the energy downturn, the growth of the energy industry, especially the oil and gas industry, continues to suffer an unprecedented decline, and Ferrellgas is already ahead, confident in its ability to gain a bigger foothold in the propane industry and in the midstream oil and gas industry.In rural areas of the country, in essence, the distribution of propane is often geographically monopolized, meaning that there is usually only one distributor in an extended rural area.Ferrellgas takes advantage of this advantage to actively acquire and continue to solicit regional propane suppliers/distributors who may be interested in selling their business.This strategy has been successful, making Ferrellgas the second largest propane distributor in the country with a 9% market share.Ferrellgas currently has about 68% of the propane market, consisting of independent retailers, and Ferrellgas has an excellent opportunity for sustained growth through industry consolidation.The company's two recent acquisitions offer additional diversity to its revenue-generating sector.Ferrellgas acquired Sable Environmental mental in May 2014, which brought new progress to the midstream oil and gas industry.The Sable offers salt water disposal services to Eagle Ford shale in Texas.Even more exciting, ferrellgas acquired Bridger Logistics, which provides end-to-end services, in June crude oil logistics from wellhead to North American terminal market.Bridger's acquisition is expected to increase Ferrellgas immediately, with an annual increase of $100 million in EBITDA, a third increase from the current level.Financiferrellgas has achieved impressive growth in both revenue growth and adjusted EBITDA.For the fiscal year 2014 (as of 7/31/2014), the Company's consolidated income was $2.405 billion.This is 2013 more than FY's $1 consolidated income of 21%.975 billion.The Adjusted EBITDA also showed strong growth.Between fiscal 2012 and fiscal 2014, the Adjusted EBITDA grew by nearly 50% from $193.$1 million to $288.1 million.For the fiscal year 2014, Ferrellgas's operating income was $144.Interest expenditure of $4 million and $86.Interest coverage of 5 million is 1.67x.In the most recent quarterly results, Ferrellgas's operating income was $60.Interest expenditure of $4 million and $23.Interest coverage of 5 million is 2.57x.While changes in interest coverage seem unusual, it should be noted that ferrellgas's revenue peaked in its second and third fiscal quarters, this is due to the large amount of propane used in residential and commercial buildings for heating purposes.It is also worth noting that in June 2015 Ferrellgas rated the $500 bond at 6.75% helps fund the acquisition of Bridger Logistics.As mentioned earlier, this will increase the annual interest expenditure of about $34 million, but the acquisition of Bridger will also have a direct value-added Effect on EBITDA.Other notable balance sheet figures in the previous quarter report: as of 4/30/2015, the company had $7 in cash on hand.4 million.Property, plant and equipment worth $614.2 million.It is also worth mentioning that Ferrellgas has recently doubled its quarterly dividend to shareholders.5%, the first growth in the company's history.This brings the company's current distribution rate to around 9%.This increase coincides with Bridger's recent acquisition, leading to the conclusion that the acquisition will support further growth and dividend growth for the company.This increase should encourage bondholders, as this dividend level provides an additional cash buffer if there is a quarterly fluctuation in the company's cash flow.Risk default risk is the execution capability of ferrelgas.Through its recent acquisition of Sable environment and Bridger Logistics, the company has made outstanding progress in diversifying its revenue sources, as Bridger Logistics Acquisitions through an annual increase of $100 million in EBITDA, the acquisition of Ferrellgas increased immediately.It is also encouraging that the company has recently tripled its quarterly distribution to shareholders.5%, is the first such growth in the company's history.As ferrellgas continues to seek and aspire to grow through value-added acquisitions, the company is fully capable of leveraging the integration of the propane industry and the addition of the newly established midstream services division.Due to changes in seasonal temperatures, revenue sources for ferrellgas sales and distribution of propane vary throughout the year.Demand for winter (heating for residential and commercial buildings) has increased.As a result, the company has higher revenues in the second and third Fiscal Quarters (peak winter periods.One of Ferrelgas's ways to increase these revenues over the rest of the year is to sell portable cans to exchange propane through its Blue Rhino division.These sales increased operating profits in the first and fourth quarter of the company.Seasonal Business activitiesAs with other commodities, the main source of revenue for Ferrellgas-propane prices are also subject to price fluctuations.Although prices have fallen over the past 12 months, which is similar to the prices of oil and gas, the impact on Ferrellgas is positive.Due to lower propane costs, profit margins have increased significantly in the past few quarters.For example, the cost of propane in the second quarter of fiscal 2015 was 40% lower than last year.over-year.On an ongoing basis, the company uses risk management activities such as the use of financial derivatives to hedge the risk of price fluctuations.These 8% yields are short.The yield and maturity dates of fixed-term bonds are similar to other bonds recently reviewed on bondsYields.Com, etc. 7.62% Rent-A-Center 7 (Nasdaq: RCII ).83% PHI (NAPHII) and 9.18% Pa G of drilling (NYSE: PKD) bonds.Summary and conclusion ferrellgas has achieved considerable growth due to its many acquisitions.The company recently decided to start diversifying beyond its core propane business, which has begun to benefit the company and its shareholders, for the most recent timeDistribution is increasing every quarter.These 8.625% of bonds, a relatively short 58-The current rate of return on the worst phone (in 3 years) is about 8%, more than 5 times the current 5-5 when the month expiresAnnual US Treasury yield 1.49%.Although the current premium on these bonds is about 101.5, yields are very attractive to income investors, so we mark these bonds as something other than our global high yield bondsFixed income and portfolios.Issuer: LPCoupon, FerrellGas Partners: 8.625% maturity: 6/15/2020 rating: B3/B-CUSIP: Semi 295ae5pay: halfAnnual price: 101.The yield of 5 pairs of worst calls :~ 8.0% (@ 100 6/15/2018) yield to maturity :~ 8.23% disclosure: some Durig capital customers may currently own 2020 bonds from Ferrellgas partners LP.Please note that all yield and price indicators are shown from the beginning of our study.Our report is by no means an offer to buy or sell any securities.We are not a broker/distributor and the report is intended to be distributed to our customers.Due to our institutional associations, we often get better revenue/price execution for our clients than originally shown in our report.We welcome inquiries from other consultants who may also be interested in the possibility of higher returns for our work and retail customers.Disclosure: I/we have no positions in any of the stocks mentioned and no plans to start any positions in the next 72 hours.This article was written by myself and expressed my views.I was not compensated.I have no business relationship with any stock company mentioned in this article.
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