Published Sat, 27 Jun 2020 09:15:00 -0400 on Seeking Alpha
Seeking AlphaDividend Ideas | BermudaHöegh LNG Preferred Units: 10% Yield, 3.8X Coverage, 12% Discount, No K-1Jun. 27, 2020 9:15 AM ET|| About: Höegh LNG Partners LP 8.75% CUM PFD A (HMLP.PA)by: Double Dividend StocksDouble Dividend Stocks Hidden Dividend Stocks PlusTarget 5-10% yields backed by solid earnings for better portfolio income.SummaryHMLP.PA units are selling at ~$22.00, 12% below their $25.00 call value.
The yield is 9.95%.
The Net Income Distribution Coverage factor was steady in Q1 2020, at 3.8X.
Looking for a well-covered high-yield income vehicle? The Hoegh LNG Partners LP, 8.75% Series A Cumulative Redeemable Preferred Units (HMLP.PA) might float your boat.
These are cumulative preferred units, meaning that management must pay you for any skipped distributions before they pay common unitholders. They're also senior to the common in a liquidation scenario.
The call date is 10/5/2022, with no maturity date.
Profile Hoegh LNG Partners LP (HMLP) is a pure-play on FSRUs. FSRU stands for "Floating Storage & Regasification Unit." FSRUs have been a rapidly-growing presence in the LNG shipping industry in the last few years.
HMLP's parent/sponsor, Höegh LNG Holdings Ltd., is the largest provider of FSRUs in the market. FSRU leasing/chartering solves many problems for charterer companies and countries. It's slow and expensive to build an LNG import terminal, so FSRUs are being increasingly used to give countries access to LNG. HMLP operates on long-term contracts with a current average remaining length of 9 years:
The fleet operates in Europe, Asia, and South America:
HMLP has a 50% ownership in the Neptune and Cape Ann vessels, and 100% in the Lampung, Gallant, and Grace vessels. The Gallant was leased back to HLNG in February 2020:
Preferred Distribution At $21.98, these units yield 9.95%, and are 12% below their $25.00 call value. They go ex-dividend and pay out in a Feb/May/Aug/Oct.... Read more