Price Target Raised for 8% Yielding MLP

by Sam Collins | January 8, 2013 1:35 am

Rentech Nitrogen Partners L.P. (NYSE:RNF[1]) — This master-limited partnership (MLP) is a provider of clean energy solutions and nitrogen fertilizer. Third-quarter 2012 earnings of $0.75 beat consensus estimates of $0.63 per share. Revenues grew by 53% versus estimates of 22%. Growth may slow in Q1 as a result of unscheduled maintenance and acquisitions, but should pick up again in Q2 through Q4.

Its cash available for distribution was cut by $0.03 to $3.37, for an 8% yield. As a publicly traded limited partnership (PTP), Rentech is expected to continue to receive favorable tax treatment. (See the NAPTP website[2] for information on PTPs, current thinking on their tax treatment, and answers to just about every question you may have about them.)

The Trade of the Day[3] first commented on RNF on Nov. 30, when it was trading at $39.55. On Monday, the stock broke from a consolidation (triangle) that formed following a run from $22 to over $39 despite the minor revision in its cash distribution. The breakout should add another leg to its bull market and the near-term trading objective is raised from $44 to $46. And long-term investors could receive a much higher return.

01 08 12 rnf 300x216 Price Target Raised for 8% Yielding MLP
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chart key 300x84 Price Target Raised for 8% Yielding MLP

Endnotes:
  1. RNF: http://studio-5.financialcontent.com/investplace/quote?Symbol=RNF
  2. NAPTP website: http://www.naptp.org/
  3. Trade of the Day: http://investorplace.com/2012/11/buy-this-safe-8-plus-yielder-for-the-next-leg-up/

Source URL: http://investorplace.com/2013/01/trade-of-the-day-rentech-nitrogen-partners-l-p-nyse-rnf/
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