AMUB - Midstream/MLPs Revamped: Income And Total Return

• In contrast to the prior midstream business model that emphasized a grow-at-all-costs mentality reflected in both dividends and capital spending, midstream has been shifting to a more sustainable growth model that is not dependent on raising equity for funding.
• The upshot of pressured equity performance blended with resilient EBITDA estimates is significantly discounted EV/EBITDA valuations for midstream companies relative to history, creating the opportunity for capital appreciation as multiples expand.
• Rather than enjoying yield alone, midstream investors can benefit from total return as a result of the more balanced approach taken by midstream companies, the potential for capital appreciation, and possible shareholder-friendly returns as free cash flow generation takes hold.

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