High-Dividend Stock Yields 11% With Strong Coverage, Looks Cheap Vs. Peers

We took another stroll back to the dog pound this week. This LP yields 11.4%, with 1.3x trailing coverage. It has the lowest Price/DCF vs. its high yield peer group. It also has the lowest EV/EBITDA. We examine management's EBITDA guidance, comparing Q1 actuals, to see if they're on target for 2017.

Should Martin Midstream Partners LP (NASDAQ:MMLP) should be let out to run. Mr. Market doesn't think so yet - MMLP has trailed the market and the ALPS Alerian MLP ETF (NYSEARCA:AMLP) over the past month, quarter, year to date and year. MMLP's management slashed its distribution by 39% in Q3 '16, from $.8125 down to $.50, in order to improve its coverage, which had dipped to .76x in Q2 2016. Since then, however, there's been a big improvement in coverage, which peaked at 1.98x in Q4 '16 and ended Q1 '17 at 1.68x, giving it a 1.3x trailing coverage ratio.

Source: Seeking Alpha

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