Dynegy Inc. (NYSE:DYN)

CAPS Rating: 2 out of 5


Player Avatar TMFDeej (99.22) Submitted: 12/31/2012 12:39:48 PM : Outperform Start Price: $19.15 DYN Score: -11.24

What special situation investors doesn't love a good post-bankruptcy play? Here's one of the more interesting ones that I've seen in a while, Dynegy.DYN has been one seriously messed up company. With such solid assets, like new relatively clean power plants, one would think that the company would have done fairly well. Alas, the current weakness in power prices caused in large part by low natural gas prices have hurt DYN even more than most power producers. Combine that with some mismanagement and boom DYN was forced to file for bankruptcy.The company recently emerged from BK as a much stronger company with a much cleaner balance sheet. I have been considering playing the cleaner power companies on the thesis that they will benefit from the EPA's new clean air regulations more than their dirtier counterparts for some time now. Thank goodness I haven't because power company stocks have been hammered by the stock market. I still think that cleaner companies like DYN stand to benefit when the EPA regulations go into effect.Time will tell. I am adding DYN to my CAPS portfolio today at $19.10/share. The idea for this trade came from the following interesting Barron's piece on the hedge fund Venor Capital Management.http://online.barrons.com/article/SB50001424052748704723404578199451836985158.html?mod=BOL_hpp_mag#articleTabs_article%3D1Deej

Member Avatar Mega (99.97) Submitted: 9/15/2013 10:05:22 PM
Recs: 0

They're still structurally unprofitable, and overpriced too. I like post-bankruptcy situations but I don't like DYN.

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