In a recent article entitled "The Dark Side of MLP Investments," we lay out the investment thesis for MLPs in today’s market:
- Contrarian Opportunity: Valuations are at historic low levels due to a multi-year bear market that originated from the crashing commodity prices in 2014.
- Improving Fundamentals: While share prices kept on dropping, the fundamentals of the sector have greatly improved with MLPs moving to the self-funding model and reducing leverage.
- Defensive business model: Most midstream MLPs own a significant number of regulated, demand-pull assets with long-term contracts. Additionally, commodity risk is