Figures and Tables

The charts and graphs below are some of our most requested and frequently cited. We are happy to make them available for general use by the investing community, whether for personal use in making an investment decision, presenting to clients interested in MLPs, or speaking at a conference. We are thrilled you’ve chosen us as your MLP information provider and respectfully request that Alerian is cited whenever these charts are used. If there is another chart, graph, or statistic that would be helpful and it’s not listed below, please contact us at [email protected], and we’ll do our best to provide you with the information. Please click on the images below to see a larger version that is available for download.

  • Slide1
    In any given year, the number of MLP IPOs launched depends on the broader market, investor sentiment, and new businesses eligible for the MLP structure. Of particular note is the lack of IPOs in 1997 and 2009, as well as the resurgence of general partner MLPs in 2006. Variable distribution partnerships reemerged in mid-2011, but IPOs have been less frequent in recent years. The average IPO size was roughly $115 million in 2004 and ten years later in 2014, the average IPO size was about $360 million.
  • In 1995, there were 16 MLPs with a total market cap of $7 billion. During the late 1990s and early 2000s, names that are now large-cap core midstream holdings in most MLP investors’ portfolios went public. These names paved the way for MLP market cap to grow fivefold to $50 billion in 2004. When commodity prices improved in the early/mid-2000s, several E&P and marine transportation MLPs went public. In recent years, with the passage of the JOBS Act and expanded private letter ruling (PLR) interpretations of qualifying income from the IRS, many non-traditional businesses have monetized their assets into the MLP structure, including frac sand, fertilizer, and mineral interest companies.

  • Slide3The periodic table of performance shows how each relevant sector has performed over the years and how they stack up against each other.

  • Slide4
    MLPs continue to grow their distributions on a year-over-year basis, albeit at a slower rate. Though there are exceptions (dropdown stories), the MLP sector in general is leaving behind the old convention of 6-8% annual distribution growth (when factoring in organic and acquisition growth) in favor of more conservative distribution growth and stronger balance sheets. As MLPs increasingly shift to self-funding their equity capital needs, capital appreciation should represent a larger portion of MLP total returns relative to distribution growth. For an explanation of the method used to calculate distribution growth, please click here.
  • Slide6

    Historically, the 10-year median yield spread between MLPs and the 10-year Treasury has been 422 bps, but it has been as high as 1205 bps and as low as 27 bps. However, as the MLP space moves from an emerging to an established asset class, the factors affecting the yield spread continue to evolve. In the years before the financial crisis, MLP distribution growth was at all-time highs and risk premiums decreased across the broader economy, causing the spread to compress to a historical low. During the financial crisis, yield spreads spiked to their highest levels, exacerbated further as levered funds sold positions to meet margin calls. As the economy recovered, additional MLP access products were launched into the marketplace, allowing for greater institutional participation in the space.

  • Slide6

    Prior to 2007, the only available way to invest in MLPs on an exchange (other than directly) was through a closed-end fund. These funds were the first pooled products to compile K-1s and return a Form 1099 to investors. Since then, mutual funds, ETNs, and ETFs have launched, offering investors different objectives and preferences.

  • Slide7

    As Alerian continually reiterates, for a US taxable investor who is comfortable building a portfolio as well as filing K-1s and state taxes, a direct investment in individual MLPs will always be the most tax efficient way to access the space. When considering an access product, investors are urged to consider fees, tracking, liquidity, leverage, credit risk of the issuer, and tax treatment, among other issues.

  • Slide8

    With a diversity of options available, choosing an MLP investment product can be a difficult process. Please see our Applied MLPs section for further information on the various types of MLP investment products available.

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The accuracy and/or completeness of any Alerian index, any data included therein, or any data from which it is based is not guaranteed by Alerian, and it shall have no liability for any errors, omissions, or interruptions therein. Alerian makes no warranties, express or implied, as to results to be obtained from use of information provided by Alerian and used in this service, and Alerian expressly disclaims all warranties of suitability with respect thereto.
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