Yesterday Duncan Energy Partners (DEP: chart, web, Y!) posted its Q4 earnings results for 2008, highlighting a a 58 percent increase in net income to $10.8 million or $0.39 per common unit (diluted).  Compare this to $6.8 million (net), or $0.30 per common unit for Q4 ‘07.

For the quarter, distributable cash flow increased 63 percent to $15.4 million compared to $9.4 million in the same quarter of the previous year.  All told, this represents about a 12% return.

It appears that the distribution is stable on the heals of an increase on January 9th, whereby the board of directors of Duncan Energy Partners’ general partner declared an increase in the quarterly cash distribution rate to $0.4275 per unit for Q4 ‘08.

Unfortunately, the market didn’t appreciate the earnings like I did, as the shares slid another 3% on falling crude oil prices.

While the price action was frustrating, the strength of the business is still appealing, even with a heavy portfolio of oil and gas already.  The yield is still flirting with 10% and the prospects of an ever-increasing distribution look healthy.

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Investing, Stock Thoughts DEP, Duncan Energy Partners, earnings

I’ve been thinking about a good non-oil related stock to start building a position in.  What do you guys think about Wal-Mart (WMT: chart, web, Y!).

It’s had a good run recently, which makes me wonder if it’s too late to get in.

In no way do I think we’re out of the woods in terms of our countries credit and debt problems, and I think we’re just now seeing the effects of a slimmer wallet.

Investing, Stock Thoughts Wal-Mart, WMT

It’s been a while since I posted anything regarding my investment activities, mostly out of lack of information to report on. I’ve been buying more shares of PVX (PVX: chart, web, Y!) recently, but more significantly, there is some good news on Duncan Energy Partners (DEP: chart, web, Y!).

Second quarter results are out, and things are looking strong. A few snippets:

• The partnership reported a 45 percent increase in net income to $6.6 million for the second quarter of 2008, compared to net income of $4.5 million for the second quarter of 2007.
• Distributable cash flow increased 65 percent to $10.8 million in the second quarter of 2008 from $6.6 million in the second quarter of 2007.
• On July 16, 2008, the board of directors of DEP’s general partner approved an increase in the partnership’s quarterly cash distribution rate paid to partners in respect of the second quarter of 2008 to $0.42 per common unit, or $1.68 per unit on an annualized basis.
• Revenue increased 52 percent to $360.4 million for the second quarter of 2008 from $236.9 million for the second quarter of 2007.
• Gross operating margin for the second quarter of 2008 decreased to $18.7 million from $21.5 million reported in the second quarter of 2007.

Overall I think these are good results, and definitely a sign of strength.

DEP stock has been battered down due to big money fleeing income funds, primarily from the likes of Goldman Sachs.  The company is paying out a 10% return, on growing revenues.

The only down side I see to the report is margin compression, which is to be expected in today’s environment.  The cost of doing business is going up, just like everywhere else.

Energy, Investing, Oil & Gas, Stock Thoughts DEP, Duncan Energy Partners