QR Energy: Not Your Average Joe ($QRE)
We like to keep up on the great MLPs that come along in the market place. QR Energy is an MLP we haven’t reported on in the past. However, today is the day! Here is some great info on QRE from Ocean Man.
Recent Stock Price Performance
QRE had its IPO in December of 2010 with an opening price of $19.90. It reached a high of $23.50 in early 2011, and then fell along with the overall market to a low of $17.13 in the fall of 2011. Soon after, the combination of an accretive acquisition and being named to the Alerian MLP Index took QRE up more than 20% in one week. It returned to $23.50 in March of 2012, but then began a steady slide back under $18 when it announced a large secondary public offering of common stock to fund acquisitions.
The secondary doubled the float, however the distribution coverage ratio remains a healthy 1.4x. The 25% drop in price may be seen as excessive, and the stock was called oversold byForbesthis month. Baird has declared the overhang of the secondary to be in the rear-view mirror, upgrading QRE to outperform with a price target of $24. With a most recent close of $17.55, the stock is near the bottom of the trading range detailed above. The already-announced distribution increase for second quarter brings the yield to an attractive 11.1% at this price, and QRE’s mission to grow future distributions through strategic production development and accretive acquisitions leads me to believe that the stock is currently offering a favorable entry price.
This MLP has a different outlook in the energy market than some of the previous articles we have discussed. If you are looking to branch out, QRE could be a great choice. Continue your research here, it could really pay off.
Quotes taken from report by Ocean Man, Read the entire article here.
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