Midstream/MLP Earnings So Far: M&A, Dividends, Buyback And ESG
Published Nov 4, 2020 on Seeking Alpha

Seeking AlphaCommodities  | Market OutlookMidstream/MLP Earnings So Far: M&A, Dividends, Buyback And ESGNov. 4, 2020 8:00 AM ET|| Includes: AMJ, AMLP, AMNA, AMTR, AMU, AMUB, AMZA, ATMP, BMLP, CBA, CEM, CEN, CEQP, COP, CTR, CVE, CVX, CXO, DSE, DVN, EMLP, EMO, ENFR, EPD, ET, FEI, FEN, FMO, FPL, GER, GMZ, HUSKF, IMLP, JMF, JMLP, KMF, KMI, KYN, MIE, MLPA, MLPB, MLPI, MLPO, MLPS, MLPX, MMP, MPLX, NGL, NML, NTG, OKE, PAA, PE, PSXP, PXD, SMM, SRF, SRV, TTP, TYG, WPXby: AlerianAlerian Master limited partnerships, Oil & Gas, energy, natural resourcesAlerian Insights.cls-1{fill:#024999;}SummaryMidstream companies have largely been positive on upstream consolidations, as the combined entities result in stronger customers, but management commentary on midstream consolidation has varied.
As of the end of October, 34 of the 39 dividend-paying names in the Alerian Midstream Energy Index have declared their 3Q payouts, with 29 maintaining, 3 growing, and 2 cutting sequentially.
Discussion of the energy transition and opportunities in renewables have shifted from the Q&A portion of 2Q20 calls to the prepared remarks for 3Q20.

Despite broader market headwinds and oil price weakness weighing on recent performance, midstream earnings season has been mostly positive thus far with only a few negative headlines, namely in the form of two MLP distribution cuts. Results have largely exceeded consensus expectations. Aside from operational updates, performance during the quarter, and comments on recovering demand and production trends, company earnings calls have typically included discussions of consolidation and opportunities around renewables and the energy transition. Capital allocation has also been in focus, including the high hurdle rates for investing growth capital in the current environment and thoughts around returning excess cash to shareholders for those not needing to reduce leverage. This note highlights some of the key takeaways from earnings calls and... Read more