Portfolio Action Summary

• Crestwood Midstream Partners (NYSE: CMLP) downgraded to a Sell in the Growth Portfolio
• Kinder Morgan Energy Partners (NYSE: KMP) upgraded to a Buy below $90
• Boardwalk Pipeline Partners (NYSE: BWP) downgraded to a Hold from a Buy below $15
• Alliance Holdings (NASDAQ: AHGP) buy below target raised to $77 from $68
• DCP Midstream (NYSE: DPM) buy below target raised to $60 from $51
• EnLink Midstream (NYSE: ENLC) buy below target raised to $44 from $40
• Enterprise Products Partners (NYSE: EPD) buy below target raised to $85 from $75
• Energy Transfer Equity (NYSE: ETE) buy below target raised to $66 from $52
• Kinder Morgan (NYSE: KMI) buy below target raised to $40 from $37
• Magellan Midstream Partners (NYSE: MMP) buy below target raised to $90 from $77
• MarkWest Energy Partners (NYSE: MWE) buy below target raised to $77 from $70
• Oiltanking Partners (NYSE:OILT) buy below target raised to $55 after 2:1 split, from $75
• Sunoco Logistics (NYSE: SXL) buy below target raised to $48 from $45.50
• Teekay LNG Partners (NYSE: TGP) buy below target raised to $52 from $46
• UGI (NYSE: UGI) buy below target raised to $57 from $50

Alliance Holdings (NASDAQ: AHGP) will report second-quarter earnings on July 28. Units made little headway during a down-and-up June, but have more recently challenged May’s record highs. A May presentation by the general partner of Alliance Resource Partners (NASDAQ ARLP) noted growing coal consumption by utilities out of stockpiles showing big declines year-over-year as well as a start-up ahead of schedule in April of a new mine developed by Alliance in the low-cost Illinois basin. On July 7, Raymond James upgraded the AHGP to a Strong Buy. Buy AHGP below an increased is still a Buy up to $77.

AmeriGas Partners (NYSE: APU) will report third-quarter earnings on July 30. Units of APU fell 4.2% in June as Energy Transfer Partners sold 9.7 million unit representing the remainder of its stake in AmeriGas acquired as consideration for the sale to the latter of Heritage Propane. With Energy Transfer’s selling out of the way, AmeriGas should ride its attractive 7.8% yield, steady growth and rising margins much higher. #9 Best Buy APU is a Buy up to $51.

Atlas Resource Partners (NYSE: ARP) is expected to report second-quarter earnings on Aug. 8. Units gained 5.6% in June, recovering some of the ground lost in May as the partnership completed its $420 million purchase of mature Colorado crude wells from Chevron (NYSE: CVX). Corporate insiders and hedge fund manager Leon Cooperman bought shares worth some $2.8 million at the may lows after the deal had been announced. At a current yield of 11.5 percent, ARP is a Buy up to $23.

Boardwalk Pipeline Partners (NYSE: BWP) will report second-quarter earnings on Aug. 4. Units rose 3 percent in June and are up 28.9 percent since our April 4 recommendation. A presentation by the distribution pinching partnership in June highlighted its upside exposure to transport demand stemming from the fast-growing  natural gas production in the Northeast and construction of ethane crackers in Louisiana. on the other hand, EBITDA would need to increase more than 20 percent from last year’s levels to reach the 4x debt/EBITDA target set by management as a prerequisite for distribution growth. Given the strong price gains from springtime lows, BWP is now a Hold.

Buckeye Partners (NYSE: BPL) units rose 5.8% in June, culminating in an all-time high of $83.78 on July 1 before profit-taking set in, as the partnership continued to highlight its growth opportunities in crude oil storage and logistics. In May, Buckeye announced a 4.8% increase in its distribution year-over-year, and the units now yield 5.5%. But Buckeye must execute on recent asset acquisitions, because the current distribution gains are using up nearly all of the distributable cash flow, and deb remains relatively high. BPL is a buy on dips below $70.

Crestwood Midstream Partners LP (NYSE: CMLP) the recently announced preferred share issue amounts to a high-yield negative amortization loan that will sap future profitability. Sell CMLP. For more on this recommendation, see “Crestwood’s Payday Loan.”

CVR Refining LP (NYSE: CVRR) has so far recovered not quite half of its June 25 9% swoon on news that the US will now permit the export of minimally processed oil condensate. The tentative relaxation of the long-standing crude export ban is unlikely to significantly raise the partnership’s costs in the near term. Though CVRR is a variable distribution MLP with no payout guarantees, it’s very likely to generate a at least 10% of the current unit price over the course of 2014.  The refiner is expected to report on Aug 1. Buy CVRR below $26.

DCP Midstream Partners LP (NYSE: DPM) will report earnings on Aug. 5. The unit price rose 6.2% in June after the gas gatherer and processor set a goal of growing its distribution 7% this year. The partnership is poised to benefit from strong drilling activity in the Eagle Ford, where its volume was recently up 22% year-over-year. The current yield is 5.3%. Buy DPM below the increased target of $60.

EnLink Midstream (NYSE: ENLC) will report on Aug. 6. The share price of the general partner to the EnLink Midstream Partners (NYSE:ENLK) gathering and processing MLP sponsored by Devon Energy (NYSE: DVN) inched up 1 percent in June. We’ve seen a 23 percent return since recommending EnLink’s predecessor in December. The midstream operation should have plenty of growth ahead of it thanks to Devon’s backing.  ENLC is the #7 Best Buy below the increased limit of $44.

Enterprise Products Partners (NYSE: EPD) announced a 5.9% year-over-year dividend hike last week, even as June’s 5.3% unit price appreciation left the yield at 3.8%.

In other news, Enterprise recently announced the completion of a Seaway loop that will more than double the capacity of the crude pipeline linking Cushing, Oklahoma with the Texas Gulf Coast to 850,000 barrels per day.

Last month, Enterprise said it will build a new ethane export facility on the Houston Ship Channel under a 30-year agreement with the Port of Houston Authority.  Ethane is one of the products of natural gas processing and is used to make plastics and other chemicals. Enterprise’s natural gas liquids fractionation and storage facility in Mont Belvieu, Texas will ship ethane to the new Houston terminal via a pipeline.

The planned facility, which is expected to be the largest ethane export terminal in the world, will be able to load up to 240,000 barrels of ethane per day. The partnership expects the terminal to come online by the third quarter of 2016. Enterprise says it has the necessary long-term contracts in place but is still negotiating with some customers. The cost of the new facility has not been disclosed. Enterprise will report earnings on July 31. EPD remains our #1 Best Buy below the increased limit of $85.

Energy Transfer Equity (NYSE: ETE) seems to have emerged none the worse for wear from its aborted acquisition talks with Targa Resources (NYSE: TRGP). The unit price surged 15.7 percent in June on the historically accurate assumption that founder Kelcy Warren is a crafty and committed shopper. While yet another merger deal could certainly further enhance ETE’s incentives stream, limited partners at affiliated partnerships might profit more from organic growth like the ongoing development of the LNG export terminal in Louisiana. But what Warren wants, Warren tends to get. After the huge rally over the last year, ETE’s yield is down to 2.6%, but the distribution is on track for growth of 15-20% for years to come. Second-quarter earnings are expected on Aug. 7. Buy #3 Best Buy ETE below $66.

Energy Transfer Partners (NYSE: ETP) announced plans to build a crude oil pipeline linking the Bakken oil wells to Patoka, Illinois. From there crude could continue to the Gulf Coast refiners using the partnership’s repurposed Trunkline gas pipeline or be transferred by train for shipment elsewhere in the Midwest and the Northeast. The new pipeline will be 30 inches in diameter and will ship at least 320,000 barrels per day. The partnership has locked in long-term shipper commitments to support the project, which is scheduled to enter service by the end of 2016.

ETP also announced that it’s board of directors has approved a pipeline to transport natural gas from the Marcellus and Utica shale basins to various markets in the US and Canada. Energy Transfer has  secured long-term agreements with three prominent drillers, two of which could take equity stakes in the project. The pipeline will have a capacity to transport 2.2 billion cubic feet of natural gas per day (bcf/d) but may be enlarged to handle 3.25 bcf/d depending on demand. ETP expects to launch service to its Midwest hub in Ohio and Gulf Coast markets by the fourth quarter of 2016 and the remaining markets including Ontario by the second quarter of 2017.

ETP will report second-quarter earnings on Aug. 7. The unit price rose 3.3 percent in June. The 6.6% yield and highly visible growth opportunities make ETP the new #8 Best Buy below the $65.

EQT Midstream Partners (NYSE: EQM) rallied 18.4 percent in June as investors continued to pile into the fastest-growing MLPs. Demand was boosted by the partnership’s inclusion into a key MLP index tracked by asset managers, and by expectations of additional Marcellus gathering system dropdowns from sponsor EQT (NYSE: EQT). More recently, profit-taking has set in, made easier by the modest 2% yield. EQT will report second-quarter earnings on July 24. We’re sticking with our recent call suggesting the sale of half your initial investment after a return of more than 100% since last August’s recommendation. Sell half of EQM.

GasLog Partners (NYSE: GLOP) continued to act as a speculative issue rather than a growth-oriented MLP following its May IPO, rallying 37% in June only to retreat 11% so far this month. The current price provides a yield of 4.6% based on the minimum annual distribution specified before the IPO, and if other high-growth MLP vehicles are any guide there’s still room for the yield to go much lower. But we’re keeping our powder dry on this one for now after a 23% return in two months. GLOP is a Buy under $30.

Genesis Energy (NYSE: GEL) predictably boosted its distribution by 10.8 percent year-over-year, announcing a payout of $0.565 per unit on Aug. 14 to holders of record as of Aug. 1. Despite the partnership’s excellent record of distribution growth, we’re biding our time until the merely adequate distribution coverage improves. Units shed 1 percent in June. Earnings are expected July 31. GEL is a Hold.

Holly Energy Partners LP (NYSE: HEP) is expected to report second-quarter earnings before the market opens on Aug. 5. Units rose 0.8 percent since we recommended HEP on June 10 for its relatively generous and secure yield in the refining logistics sector. Buy HEP under $40.

Kinder Morgan (NYSE: KMI) will report earnings on July 16. The share price was up 8.6 percent in June as sentiment continued to recover from the growth concerns that came to the fore last year. We believe the business fundamentals are improving and the current yield of 4.7% is relatively rich for a giant with an excellent shot at increasing its dividend by 10% or so in each of the next several years. KMI is the new #5 Best Buy below the increased limit of $40.     

Kinder Morgan Energy Partners (NYSE: KMP) will also report on July 16, leading off for the MLP sector. The unit price rose 8.8 percent in June. Yet the 6.9% current yield looks plenty generous given its own moderate but still attractive growth prospects, at least in the current low-yielding environment. We’re upgrading KMP to a Buy below $90.

Magellan Midstream Partners (NYSE: MMP) will report earnings on Aug. 5. The unit price rose 4.1 percent in June as the partnership continued to benefit from growing domestic crude volumes. MMP is the #2 Best Buy below the increased limit of $90.

MarkWest Energy Partners (NYSE: MWE) will report second-quarter earnings on Aug. 7. The unit price rallied 16.9 percent in June and longer-dated call options were also in demand as speculators bet that investments in additional Marcellus and Utica processing capacity will pay off despite the recent slowing of distribution growth. We agree, making MWE the new #6 Best Buy below the increased limit of $77.

Navios Maritime Partners (NYSE: NMM) will report second-quarter earnings on July 25. The unit price rose 4.8 percent in June. Jefferies initiated NMM with a Buy in June with a price target of $22. We rate NMM a buy on dips below $17.70.

NGL Energy Partners (NYSE: NGL) followed its deal to buy the general partner of Transmontaigne Partners (NYSE: TLP) along with limited partnership interests with an offer to exchange TLP units for new NGL ones on a 1-for-1 basis. Since NGL’s current 5.1% yield trails TLP’s recent 5.8% the merger offer can be seen as a money-saving measure. But it would also keep NGL’s structure simple and give TLP unitholders access to NGL’s greater growth and better distribution coverage.

We continue to like the Transmontaigne acquisition for NGL for its potential to add scale and increase efficiency. But the partnership has not neglected organic growth opportunities, recently announcing the addition of five salt-water disposal wells in the Eagle Ford and Permian basins, where drilling activity is booming. The addition boosts NGL’s treatment and disposal capacity by 30% at a cost of $83 million, which looks likely to be recouped from profits in five years or less. Opportunities like these make NGL a Buy up to $50.

Oaktree Capital Management (NYSE: OAK) marked time in June, despite a trailing yield of more than 8% and status as the leading manager of alternative investments, especially in distressed debt. Investors have been concerned about the modest current opportunity set, though Oaktree has been bargain-hunting in Europe. Perhaps more to the point, the yield is likely to decline considerably in the coming quarters amid a lull in lucrative fund liquidations. But there’s solid long-term value here, enough so that even a 5% forward yield will do.  Buy OAK up to $52.

Oiltanking Partners (NYSE: OILT) will report second-quarter earnings on Aug. 7. The unit price gained 5.5 percent in June on growing flows of domestic crude to the Gulf and expectations of increased energy exports, which play right into Oiltanking’s role as a leading Gulf crude storage provider. The stock has just split 2:1, and though the yield is a modest 2.1 percent this seems like a good time to increase exposure to one of the sector’s best growth stories, one being driven by valuable organic growth rather than dropdowns. Buy OILT below the increased split-adjusted limit of $55.

Regency Energy Partners (NYSE: RGP) will report second-quarter earnings on Aug. 7. Units of RGP jumped 15.3 percent in June. On July 1, Regency closed on a previously announced acquisition of the midstream assets of Eagle Rock Energy Partners (NASDAQ: EROC), adding 8,100 miles of gathering pipelines and over 800 million cubic feet per day of natural gas processing capacity at a cost of more than $1.3 billion in cash, equity and debt. To help fund this acquisition, Regency sold 14.4 million common units to its general partner, Energy Transfer Equity.  ETE Common Holdings, its subsidiary, for a total of $400 million. RGP is currently a Hold.

SemGroup (NYSE: SEMG) will report second-quarter earnings on Aug. 8. Units of SEMG surged 17.8 percent since recommended on June 10. SEMG hit an all-time high of $81.20 on July 2 since going public in Mar. 2010. SEMG is a Buy below $82.

Spectra Energy Partners (NYSE: SEP) announced plans to expand its natural gas pipeline capacity into the New England market to meet demand for reliable power generation. In response to the New England governors’ recent initiative on new energy infrastructure, SEP will expand its Algoquin and Maritime pipeline systems capacity by 1 billion cubic feet per day. SEP will report second-quarter earnings on Aug. 6. Units of SEP rose 2 percent in June. SEP is a Hold.

Sunoco Logistics Partners (NYSE: SXL) will report second-quarter earnings on Aug. 7. The unit price rose 2.8 percent in June and distributions remain on track to rise 20% annually. SXL is our #4 Best Buy up to the increased limit of $48.

Targa Resources (NYSE: TRGP) shares jumped 23 percent in June after a leak of abortive merger talks with Energy Transfer Equity, and have held their gains even after management announced the talks had ended. Given Targa’s strategic footprint as a gas gatherer, processor and exporter of liquefied petroleum gas, investors have been willing to give it time to capitalize on opportunities and outside interest. We’re sticking with our recent call to sell half of the initial position after a 78% total return since the November recommendation. TRGP will release second-quarter earnings numbers on Aug. 1. Sell half of TRGP.

Targa Resources Partners (NYSE: NGLS)  The case for taking profits in Targa’s affiliated MLP is even stronger since it’s unlikely to enjoy a major merger premium like its parent, yet longtime holder could run into adverse tax consequence should they do so. Recent investors would be well advised to pare their positions, while others could consider locking in their gains via options. The unit price rose 5.9 percent last month. Sell half of NGLS.

Teekay LNG Partners (NYSE: TGP) has lagged the gains by other LNG fleet operators over the past year, but has been making up some ground of late as investors warm to its secure 6% yield and bright long-term prospects.

Sentiment has been boosted by the recent announcement of a deal to take partial stakes in four BG Group (London: BG, OTC: BRGXF) LNG carriers currently under construction in China, which are scheduled to enter service under 20-year extendable charters between 2017 and 2019. TGP has also entered into a 50/50 venture with a closely held Chinese firm to build six icebreaker LNG carriers that will serve Yamal LNG, an export terminal planned for northern Russia.

Both deals enhance TGP’s long-term revenue outlook while allowing it to make further inroads in China, which is expected to become the leading LNG shipping market.

Second-quarter earnings are due on Aug. 8. The unit price hit a record two weeks ago and looks poised to continue higher. Buy TGP below the newly increased limit of $52.

UGI Corp (NYSE: UGI) will report fiscal third-quarter earnings on July 30. On July 2, UGI said its wholly owned French subsidiary UGI Bordeaux Holding, reached an agreement to purchase Total’s (NYSE: TOT) liquefied petroleum gas (LPG) distribution business in France for between EUR 400 million to 450 million ($544 million to $612 million). Total’s LPG business serves residential, commercial and industrial customers, distributing over 265 million gallons in 2013.

The transaction, which is expected to close by the first half of 2015, is expected to be accretive to earnings per share in the first full year. The deal will be funded with a combination of cash and debt.

UGI’s share price rose 4.5 percent last month, hitting an all-time high of $50.96 on July 1. UGI is a Buy below the increased price target of $57.

Vanguard Natural Resources LLC (NYSE: VNR) will report second-quarter earnings on July 31. The unit price rose 5.1 percent in June, hitting a 52-week high. Continue to buy VNR on dips below $28.

Western Refining (NYSE: WNR) – WNR will report second-quarter earnings on Aug 5. The share price receded 7.1 percent in June. Buy WNR up to $46.

Williams Companies (NYSE: WMB) has continued to hold its ground after surging last month on news that it would buy the half general partner interest it didn’t already own in Access Midstream Partners (NYSE: ACMP), consolidating its control over that fast-growing MLP and planning to merge it with its primary MLP affiliate Williams Partners (NYSE: WPZ). Williams has returned 66% since our October buy recommendation, but the recent price action, rising debt and operational issues provide reasons for caution. The share price jumped nearly 26% last month ahead of earnings due July 30. WMB is currently a Hold.