05.01.14

The best round in boxing History.

Hi Folks,

1. $EMES goes ex-dividend tomorrow, 05.02.14, for $1.13. Their business model trumps $SLCA. $SLCA has simply an incredible 1Q conference call yesterday, transcript here.

There isn’t enough sand right now. What was 2000 pounds of sand per well is now up to 8000. $EMES is the blue chip. Expect balloon distributions going forward (folks are hunting for anything on the mine approval status).

1. Rates are going up.

2. Demand is going up.

3. Profits are going up. 

emes.div

2. $SLCA’s conference call was incredible. If you want the right sector, right names: we are locked and loaded. $SLCA trumps $HCLP.

3. $HCLP should profit too – although they have IDR”s to pay out. We will receive income from $HCLP>

4. $PEIX simply did an incredibly stupid job of reporting free cash flow – vs. including a one time charge. $GPRE  is holding its own. $PEIX is trading for a bout a 3x true P/E multiple.

Strong Yields:

I really try to hone in on the mREITs for our benefit. A 10% – 15% annual dividend yield pays the bills. I posted where our 700-shares of $MFA had a higher book value per share today – due to their hybrid non-agency MBS. Expect the same from $EFC, $MTGE, $TWO.

Key Goal:

When growth is unclear; when the economy is struggling; when Mr. Putin is taking his shirt off in the East Ukraine, the names I have chosen provide little risk and great yields. 

New Highs by Key Positions

Check out how a key name of ours, Oiltanking Partners, L.P. (OILT), is performing. With minor exceptions, I am very proud of our names and the success they are having and the success they will continue to have.

Major Mistake: Please Reconsider

I have a friend who asked about putting 50% into $ETJ.

I said “no way”.

A CEF can have fraud, can have so many things go wrong – why take the chance when we can own $EFC, $OAK, $MTGE, $TWO? You can buy OTM protective puts to avoid something God awful than 50% into a $ETJ.

Yes, $ETJ is ok: zero growth in dividend, so I prefer others. Don’t risk your entire portfolio on one CEF. They won’t ring a bell if there are accounting problems at $ETJ. And you can earn a higher return, with lower risk, by simply using your head, using common sense, and building the right portfolio. 

$EMES goes ex-tomorrow. TJ

Todd

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