- Sometimes, picking up Master Limited Partnerships with suspended or reduced distributions could lead to a strong income once they are reinstated.
- In theory, if the LNG carrier Dynagas Partners was to reinstate their distributions, they would offer a very high yield just north of 10%.
- Sadly, this does not appear likely to eventuate due to their very high leverage and very limited prospects to deleverage that could take upwards of a decade.
- The risks are further amplified by their weak liquidity that makes even their preferred units unattractive and risky.
- These factors make it likely that this Master Limited Partnership will disappoint, and thus, I believe a bearish rating is appropriate.
For further details see:
Dynagas LNG Partners: Many Years Of Deleveraging Ahead Before Getting That Old Yield