Why PVR Partners' Shares Dropped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of PVR Partners (NYSE: PVR  ) fell as much as 13% today after releasing earnings.

So what: Fourth-quarter revenue fell 6.3% to $269.6 million, below the $280 million estimate from analysts. Loss per share was $0.30, a surprise since analysts were expecting earnings of $0.17 per share.  

Now what: The only good news is that the distribution was increased to $0.55 per share, which is what most investors will look at. The bad news is that earnings haven't kept up with the distribution, bringing payouts for the future into question. I don't think the future is strong for coal demand or prices, so there will continue to be pressure on earnings, which means I'm not a buyer today.

Interested in more info on PVR Partners? Add it to your watchlist by clicking here.


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  • Report this Comment On February 22, 2013, at 9:24 PM, awallejr wrote:

    As a long time holder of PVR I take this as a buying opportunity. This company is transforming itself and moving away as a coal play but more as a fee-based bundler of several services so that they are not just a gas processor, but a water and a condensate pipeline company also.

    They have always paid their distributions, even through the Great Recession. I added and happily. As for the last ten years this company always raised its distributions aside from 2009 and 2010 where they kept it the same.

    If your reason for questioning future distributions is because of coal then you really don't know much about this company.

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