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hedges keep pricing reasonable and the dividend high
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Strictly a dividend play----10%
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First the divided alone may outperform the S&P. But what I like about this MLP is that it is set up to pay royalties on producing oil well and it is committed to drill a lot more well so most of the well are new well, not wells nearing the end of their productive life.
Recs
oil always in demand
Recs
Almost 50/50 oil and natural gas mix should allow it to weather the low price of natural gas in the near term. When natural gas rebounds (and it will in the next several years) will help the dividend increase. Currently yielding about 8% with a 2012 payout of $1.88.
Recs
Big dividends and well run trust.
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SandRidge is doing a great job at monetizing their vast acreage, and SDR is part of that, along with joint ventures. Energy. High distribution payouts. I expect oil prices to be stable @ $100+; natgas has to be close to a bottom & is likely to ~double in the near term. Finally, I like Sandridge's management.
Recs
Here's another dividend paying IPO that I came very close to adding in my real-life portfolio. I was really excited about SDR when I thought that it might price at $19. I was still interested in it at $20. However, now at $21.50 it is trading for enough of a premium to book value that I am less so. I still like it enough to add in CAPS, but not with real money.
A few issues with this stock, the parent SandRidge (SD) isn't exactly the strongest company. Also, while the yield would have been double digits at $19/share it's much lower now and possibly might not cause the stock to rocket up when investors find out about it. Also, 50% of its production is natural gas, which is pretty darn weak right now and I don't expect it to improve rapidly either.
All told, if SDR is able to pay out the dividends that it forecast in its prospectus, which in my opinion were based upon reasonable assessments and it has been able to do so with its two other trusts, I think that the total return to the end of the trust is attractive enough to warrant a CAPS play. Any improvement in natural gas prices beyond what it already priced into forward contracts would be gravy.
Deej
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