Couple Earnings of Note

We see some earnings today of note to income investors.

Ladenburg Thalmann (NYSE:LTS) has reported and they had some earnings (net income) which is nice to see. This company which has always been just marginally profitable is slowly improving in profitability.

LTS has 3 baby bonds and a 8% monthly pay preferred outstanding–these can be seen here.

The company earnings release can be seen here.

DCP Midstream (NYSE:DCP) which has 2 outstanding fixed to floating rate preferreds outstanding reported a rather stellar quarter with strong net income and cash flow. DCP is now rated just a notch below investment grade and seems like they are being very well managed. They currently have a 1.45 times coverage ratio on their common units.

The 2 outstanding preferred units can be seen here.

The company press release can be seen here.

CLO owner Oxford Lane Capital (NASDAQ:OXLC) reported a good quarter. While Collateralized Loan Obligation owners have always scared us a bit (their holdings are somewhat of a black box) they continue to perform well. The company has 2 outstanding monthly paying term preferreds–we own 1 of the issues. These issues can be seen here.

The company released a slide show with earnings and it can be seen here.

13 thoughts on “Couple Earnings of Note”

  1. Nustar up nicely on earnings report, hope they are not finally healthy enough to call the NSS. Mid-stream in general is up nicely today, even the long suffering holders of AMLP got a good pop.

    1. P, I dont there is any problems yet with NSS. They are still cash flow negative, and they still have a redeemed bond from last year engorged in their revolver. They have been yacking for 6 months about needing to refinance it and still havent done it yet. And remember they just got credit downgrades this past month.

        1. P, the good thing is this thing basically (except for Dec. rout) tracks par then rises into exD. So no call loss smack down will occur for us holding.

          1. Hey Grid and P – did you have an in depth look at the latest Nustar financials. They sold a terminal and I was wanting opinions on whether you think they are improving their situation or are self cannibalizing to pay for current projects. I dropped NSS with the last downgrade and the huge debt due in 2020, but am watching and have too noted that it stays around par and should be easy to re enter.

            1. Pete, I rely on credit agencies for me to comprehend. S&P has them as adjusted 6.9x leverage and will lower their ratings again if it goes over 7. They are projecting leverage to go to 6.3 in 2020. Trouble is they are going to be heavy cash flow negative next couple years on their buildout.
              The projects should help long term, but the concern is “execution risk”.
              Their numbers are all over the place depending on what is considered “debt”.
              This is why their bonds are a lot lower than the preferreds. Bank leverage assessment is 4.05% but it excludes NSS, preferreds, and some revolver cap ex money. Leverage also wont come down quickly also due to their dividend payouts.
              That terminal was a poor performer and earnings drag, so they were good to ditch it from what I read. Agencies say they have plenty of liquidity near term.
              Just me personally if something happens to where they get another downgrade, I am out for good. Or if oil drops below $50 I will sell also.

  2. Tim, am I’m sure you know, there is chatter on another article among your two most prolific posters, with their usual hatred of LTS. I have held a few LTS-A’s for several years and “the market” continues to see no issues, they always trade around par. The nay-sayers actually scared me into selling it at one time, but I’ve bought it back since.

    The nay-saying is so insistent and so pointed, it goes way beyond the normal “it takes two sides to make a market”. They describe LTS as being a house of cards – over and over again. I’m sick of it.

    Tim – what is your personal opinion on LTS?
    This question is for Tim and Tim alone.
    I’m only interested in Tim’s opinion. No others.
    I hope I’m being clear.

  3. What do the GLIBP fans (if there are any) make of today’s GLIBA earnings, particularly this USAC appeal?

  4. I had sold all my CenturyTel preferreds and baby bonds earlier this year for a tidy profit (lucky).

    CenturyTel continues to crater down 8.3%.

    Saw a blurb that said they were looking at strategic alternatives for their retail business.

    1. CTL is a mixed bag. Very bad for commons (I do have some positions), not good for baby bonds (luckily I sold off the high coupons ones when the Level 3 CEO Jeff Storey took over in the first quarter, “pretending that he can move the mountains of debts by calling several highest baby bonds). The latest quarter showed fantastic profit margin, deleveraging some more. Storey paid huge bonuses for Level 3 executives and managers, refuse to sell any part of the company or technology. Level 3 does have good tech properties. All the analysts were disappointed with continuing decreasing revenues and poor guidance for Q2 and rest of the year. Yesterday Morningstar analyst continues to believe that CTL common is grossly undervalued with fair market value $20. Years ago, I learned from one or more commenters on CTL baby bonds when they slided, buy the REAL bonds. I have bought.
      Cusip 156686AM9 CENTURY TEL ENTR INC NOTES CPN 6.87500 % MTD 2028-01-15 DTD 1998-01-15
      I bought 4 bonds on 7/3/2018 @ 0.93 PLUS 6 bonds on 3/4/2019 @ 0.95, Both purchases enjoyed some increase in value. Duration risk. Yes. I do believe in CTL technology. Storey does not even talk about their 5G, very far away in the future. I hold lower CTL baby bonds and will keep them. In hindsight, I failed because I trust Storey, as quite few people commented reading the Earnings CALL transcript. I will hold the commons. Storey refuse to commit on oversized dividend with CTL went from the $20’s to $10+. LOL. Jeff Storey has fooled the shareholders twice which makes him look less credible than the offsprings of Michael Karfunkel and Zyskind IMHO! Yep, CTL went up earlier in today’s trading session, now back to the dog house. Some people blamed the CEO on the bad fortune of CBL associates. I do not believe Charles L (junior) was the culprit IMHO.
      LOL.

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