Formerly a subsidiary of refiner Valero (VLO), independent NuStar Energy, LP (NS) has finally regained its mojo. After flat lining its distribution growth, the MLP has undergone a series of moves to strengthen its asset base and reduce debt.
That’s include focusing on move crude oil and natural gas in the Eagle Ford as well as reducing its exposure to “margin”-based business like asphalt refining. This refocused strategy seems to be working as the NuStar recently trounced earnings and reported that second quarter distributable cash flow was a hefty 71 cents per unit, compared to 45 cents in the year-ago period.
With NU planning on moving an additionally 25,000 barrels per day in the Eagle Ford this year, the firm’s 10% dividend seems well-covered.
As of this writing, Aaron Levitt did not hold a position in any of the aforementioned securities.