- After a terrible fiscal year amidst the downturn of 2020, NGL Energy Partners represents a deep value investment that requires close monitoring as they deleverage.
- Disappointingly their operating cash flow was negative during the first quarter of their fiscal year 2022, which saw their net debt increasing along with their leverage.
- This was due to a large working capital build, which was not a normal seasonal event and thus will have to reverse to confirm the quality of their underlying earnings.
- This makes closing the gap between their operating cash flow and its underlying results excluding working capital movements the number one item the next earnings report needs to show.
- Whilst they have seen a sluggish start to their year of deleveraging, I will be maintaining my bullish rating for the time being.
For further details see:
NGL Energy Partners: The No. 1 Item The Next Earnings Report Needs To Show