Another Win for MEMP
This oil and gas small-cap rallied strongly after reporting that average daily production increased by 23%, with adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) coming in at $73.8 million, a 32% gain from $55.7 million in the second quarter of 2013. MEMP’s second-quarter cash distribution of $0.55 per unit is 16% higher than the minimum quarterly distribution of $0.47.
In addition, during the quarter, Memorial announced its largest acquisition since its IPO: a $915 million purchase of properties in Wyoming that closed on July 1. The company conducted an 8.6-million-share secondary offering on July 10 at $22.50 per share; today the stock trades about a point below its all-time high of $24.76 set back in late June.
The current yield stands at a very attractive 9.3%, considerably more than you can get from Kinder Morgan or most of the other “big kahunas” in the energy MLP world. Consider buying MEMP on the next dip.