EQM Midstream Partners, LP (EQM) announced plans to merge with its general partner Equitrans Midstream (ETRN) in an all-stock transaction, continuing the trend of MLP simplifications. Each unit of EQM would be exchanged for 2.44 shares of ETRN stock. The exchange ratio represents only a 3% premium based on EQM's average price over the 20 days leading up [...]
In August 2019, we published a note about MPLX (MPLX) and some of the challenges weighing on the stock, including low natural gas prices, questionable acquisition decisions, and Marathon Petroleum's (MPC) control over MPLX. One month after our note was published, activist investor Elliott Management pressured Marathon Petroleum to split its conglomerate business up with hopes of unlocking value. [...]
Cisco (CSCO) was founded in 1984 and has grown to become one of the most important technology companies in the world. While the business sells a wide variety of products and services to businesses of all sizes, its main offerings connect computing devices to networks or computer networks with each other. The company’s website provides an overview [...]
On Tuesday, Franklin Resources (BEN) announced plans to acquire rival asset manager Legg Mason (LM) for $4.5 billion. Franklin's assets under management will rise from about $700 billion to $1.5 trillion once the deal closes by the third quarter of 2020, underscoring the significance of this transaction. Fortunately, Franklin's payout ratio, balance sheet, and cash [...]
Founded in 1925 with a product line consisting of just five tractors, Caterpillar (CAT) has grown to become the world’s largest industrial machine maker, with its hands in all major infrastructure industries. The company primarily sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives.Caterpillar operates through four business [...]
On February 5, Merck (MRK) announced plans to spin off its Women's Health and Biosimilar divisions, as well as various legacy branded drugs. Combined, these businesses ("NewCo") account for nearly 15% of Merck's revenue. Source: Merck Investor Presentation The spin-off transaction is expected to be completed in the first half of 2021 and will take the form [...]
Founded in 1912 during the dawn of flight, Lockheed Martin (LMT) is the world’s largest defense contractor and supplier of fighter aircraft. Though best known for its F-35 joint strike fighter, Lockheed has four major divisions that combined to generate $60 billion in revenue last year: Aeronautics (40% of sales): designs, manufactures, and services combat aircraft [...]
We are upgrading General Electric's (GE) Dividend Safety Score from Unsafe to Borderline Safe following continued improvement in the firm's cash flow generation and deleveraging progress. In early 2019, GE believed its core industrial operations might burn through as much as $2 billion as the company's turnaround took time to gain momentum. The company's money-losing Power division (about 20% [...]
Founded in 1901 after striking oil in Persia, London-based British Petroleum (BP) is one of the largest integrated oil and gas companies in the world today with operations in over 70 countries. Impressively, BP's daily output of 3.7 million barrels of oil exceeds the yield of all but a handful of nations. Like other oil giants, BP [...]