Turnaround Time For This 14% Yield: Good Upside, No K-1, Better Coverage In 2019 For Golar LNG Partners LP

This company turned around its common unit coverage in Q3 2018 but is still selling at a multi-year low, 13.8% below analysts' lowest price target. It now yields over 14%, with stronger earnings and cash flow expected in Q4 '18 and full-year 2019. Its P-Series preferred units had 8.65X coverage in the past four quarters and yield 9%.

Golar LNG Partners LP (GMLP) had a rough go of it in 2018, with multiple special surveys/drydockings and re-contracting issues that pressured its cash flow. Management finally cut the common's distribution to $.4042 from $.5775 for the Q4 2018 payout. Needless to say, that cut didn't go over so well with Mr. Market, who jumped overboard, and GMLP's common units became waterlogged, falling to the low teens from the low $20s, losing over 50% of its value in 2018. GMLP paid out $2.14 in 2018 distributions, which only slightly mitigated that 50% price decline.

Source: Seeking Alpha

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