We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Ferrellgas Unit to Sell Bridger Energy, Aims to Lower Debt
Read MoreHide Full Article
Ferrellgas Partners L.P. announced that its subsidiary Bridger Logistics will sell Bridger Energy, LLC to an undisclosed buyer. The financial consideration is yet to be revealed. The primary objective of this deal is to lower the overall debt level of the partnership.
The decision to sell Bridger Energy will lower annual interest burden by nearly $4.5 million and reduce its obligation from its current credit facility by $80 million. The decision does not come as a surprise as the performance of these assets was lower than expected.
Cold Weather Can Help
Ferrellgas Partners has been adversely impacted by warm winter weather in 2016 and 2017, which affected the sale of propane. Propane is generally used for heating, and mild winter in the past two seasons negatively impacted its volumes.
However, the present cold spell in the United States is likely to increase demand for propane.
High Debts a Concern
Long-term debts of Ferrellgas Partners at the end of first-quarter fiscal 2018 (ending Oct 31, 2017) was nearly $1.8 billion and interest expenses at the end the quarter were $40.8 million. The partnership will need to arrange for funds to service its debts, and shedding its non-core assets is a positive step in that direction.
However, monetization of non-core assets might not be enough for Ferrellgas Partners and its management might also consider the option of lowering its cash distribution level to improve liquidity.
Price Movement
Primarily due to the lower-than-expected performance in the last four quarters, Ferrellgas Partners’ stock has lost 50% in the same period, much wider than the decline of 4.8% of the industry it belongs to.
Zacks Rank
Ferrellgas Partners has a Zacks Rank #5 (Strong Sell). Few better-ranked in the sector are Marathon Petroleum Corporation (MPC - Free Report) , Delek US Holdings Inc. (DK - Free Report) and Galp Energia SGPS SA (GLPEY - Free Report) . Marathon Petroleum sports a Zacks Rank #1(Strong Buy), while the other two carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Marathon Petroleum’s long-term expected earnings growth rate is 11.02%. Its 2018 Zacks Consensus Estimate has moved up 16.8% in last 30 days to $4.39.
Delek US Holdings’ long-term expected earnings growth rate is 10.0%. Its 2018 Zacks Consensus Estimate has moved up 8.1% in last 30 days to $2.00.
Galp Energia SGPS SA’s long-term expected earnings growth rate is 3.0%. Its 2018 Zacks Consensus Estimate has moved up 25.0% in last 30 days to 45 cents.
Zacks Top 10 Stocks for 2018
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2018?
Last year's 2017 Zacks Top 10 Stocks portfolio produced double-digit winners, including FMC Corp. and VMware which racked up stellar gains of +67.9% and +61%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Image: Bigstock
Ferrellgas Unit to Sell Bridger Energy, Aims to Lower Debt
Ferrellgas Partners L.P. announced that its subsidiary Bridger Logistics will sell Bridger Energy, LLC to an undisclosed buyer. The financial consideration is yet to be revealed. The primary objective of this deal is to lower the overall debt level of the partnership.
The decision to sell Bridger Energy will lower annual interest burden by nearly $4.5 million and reduce its obligation from its current credit facility by $80 million. The decision does not come as a surprise as the performance of these assets was lower than expected.
Cold Weather Can Help
Ferrellgas Partners has been adversely impacted by warm winter weather in 2016 and 2017, which affected the sale of propane. Propane is generally used for heating, and mild winter in the past two seasons negatively impacted its volumes.
However, the present cold spell in the United States is likely to increase demand for propane.
High Debts a Concern
Long-term debts of Ferrellgas Partners at the end of first-quarter fiscal 2018 (ending Oct 31, 2017) was nearly $1.8 billion and interest expenses at the end the quarter were $40.8 million. The partnership will need to arrange for funds to service its debts, and shedding its non-core assets is a positive step in that direction.
However, monetization of non-core assets might not be enough for Ferrellgas Partners and its management might also consider the option of lowering its cash distribution level to improve liquidity.
Price Movement
Primarily due to the lower-than-expected performance in the last four quarters, Ferrellgas Partners’ stock has lost 50% in the same period, much wider than the decline of 4.8% of the industry it belongs to.
Zacks Rank
Ferrellgas Partners has a Zacks Rank #5 (Strong Sell). Few better-ranked in the sector are Marathon Petroleum Corporation (MPC - Free Report) , Delek US Holdings Inc. (DK - Free Report) and Galp Energia SGPS SA (GLPEY - Free Report) . Marathon Petroleum sports a Zacks Rank #1(Strong Buy), while the other two carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Marathon Petroleum’s long-term expected earnings growth rate is 11.02%. Its 2018 Zacks Consensus Estimate has moved up 16.8% in last 30 days to $4.39.
Delek US Holdings’ long-term expected earnings growth rate is 10.0%. Its 2018 Zacks Consensus Estimate has moved up 8.1% in last 30 days to $2.00.
Galp Energia SGPS SA’s long-term expected earnings growth rate is 3.0%. Its 2018 Zacks Consensus Estimate has moved up 25.0% in last 30 days to 45 cents.
Zacks Top 10 Stocks for 2018
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2018?
Last year's 2017 Zacks Top 10 Stocks portfolio produced double-digit winners, including FMC Corp. and VMware which racked up stellar gains of +67.9% and +61%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2018 today >>