DENVER, April 11, 2019 /PRNewswire/ -- Antero Midstream Corporation (NYSE: AM) ("Antero Midstream") today announced its first dividend since it converted to a corporation and closed the acquisition of Antero Midstream Partners LP.
The Board of Directors of Antero Midstream declared a cash dividend of $0.3025 per share ($1.21 per share annualized) for the first quarter of 2019. The dividend represents a 180% increase as compared to Antero Midstream GP LP's ("AMGP") first quarter 2018 distribution and an 84% increase sequentially. The dividend will be payable on May 8, 2019 to stockholders of record as of April 26, 2019.
The dividend also represents a 47% increase compared to Antero Midstream Partners LP's first quarter 2018 distribution and a 22% increase sequentially, each adjusted for the 1.8926 exchange ratio for unitholders who elected to receive stock in the recently closed simplification transaction. This represents the seventeenth consecutive quarterly dividend or distribution increase since Antero Midstream Partners LP's initial public offering in November 2014.
As of AM's closing price on April 15, the annual dividend yield is 8.545%, BUT I DO EXPECT AM TO INCREASE DIVIDEND QUARTER-AFTER-QUARTER.
Antero Midstream Corporation is a Delaware corporation that owns, operates and develops midstream gathering, compression, processing and fractionation assets located in West Virginia and Ohio, as well as integrated water assets that primarily service Antero Resources Corporation's properties. The Company's website is located at www.anteromidstream.com.
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The old Antero Midstream Partners LP is no longer publicly traded.
On October 9, 2018, Antero Midstream and AMGP announced that they entered into a definitive agreement for AMGP to acquire all outstanding Antero Midstream common units in a stock and cash transaction. The transaction results in the elimination of the outstanding incentive distribution rights (“IDRs”) and simplifies the structure of the midstream business into one publicly-traded corporation (“New AM”).
New AM will be a corporation for both tax and governance purposes with a majority of independent directors upon closing. Importantly, the transaction is estimated to reduce AMGP’s tax payments from 2019 through 2022 by approximately $375 million, with New AM is not expected to pay material federal and state income taxes through at least 2024. These tax savings, combined with the elimination of the IDRs, is expected to result in double digit accretion for both AMGP and AM on a Distributable Cash Flow per share and per unit basis, respectively. In addition, AM public unitholders will receive a 3% increase on their existing per unit distribution targets and growth rates through 2022, assuming unitholders elect to receive all equity consideration.
Antero Midstream Corp. (AM) for High Yield
Antero Midstream Corp. (AM) for High Yield
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Antero Midstream Corp. (AM) for High Yield
We will be publishing a profile on New AM on April 16.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Antero Midstream Corp. (AM) for High Yield
I have posted the AM profile and forecast/valuation model to the EPG website.
It will be sent to our global membership this afternoon with the note below. We have ~500 members around the world; about half of them live outside of Texas.
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Here is our updated profile on the "New Antero Midstream", one of the companies in our High Yield Income Portfolio. It is a C-Corp that pays quarterly dividends ($0.3025/share for Q1 2019). The annual dividend yield in approximately 8.5% as of the date of the profile and the company expects to keep raising dividends quarter-after-quarter through at least 2020.
On March 12th, Antero Midstream completed the "Simplification Transaction" that they announced back in October, 2018. Despite the title, the series of events necessary to convert from an MLP to a C-Corp confused a lot of investors. This is why I believe there is ~50% upside in the share price for us.
On the bottom of the last page you can find my estimate of what future dividends will be. Note that part of the conversion to a C-Corp process, unit holders in Old AM (an MLP) received 1.8926 shares of common stock for each unit they held in the MLP. The total dividend increased approximately 22% from Q4 2018 to Q1 2019 for the old unit holders.
AM's growth is highly dependent on the growth of Antero Resources (AR), so I highly recommend that you review AR's profile before you invest in AM. Yesterday, Zacks gave AR a #1 rating or Strong Buy.
As a C-Corp, AM is now better suited for an IRA account.
It will be sent to our global membership this afternoon with the note below. We have ~500 members around the world; about half of them live outside of Texas.
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Here is our updated profile on the "New Antero Midstream", one of the companies in our High Yield Income Portfolio. It is a C-Corp that pays quarterly dividends ($0.3025/share for Q1 2019). The annual dividend yield in approximately 8.5% as of the date of the profile and the company expects to keep raising dividends quarter-after-quarter through at least 2020.
On March 12th, Antero Midstream completed the "Simplification Transaction" that they announced back in October, 2018. Despite the title, the series of events necessary to convert from an MLP to a C-Corp confused a lot of investors. This is why I believe there is ~50% upside in the share price for us.
On the bottom of the last page you can find my estimate of what future dividends will be. Note that part of the conversion to a C-Corp process, unit holders in Old AM (an MLP) received 1.8926 shares of common stock for each unit they held in the MLP. The total dividend increased approximately 22% from Q4 2018 to Q1 2019 for the old unit holders.
AM's growth is highly dependent on the growth of Antero Resources (AR), so I highly recommend that you review AR's profile before you invest in AM. Yesterday, Zacks gave AR a #1 rating or Strong Buy.
As a C-Corp, AM is now better suited for an IRA account.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Antero Midstream Corp. (AM) for High Yield
Ever since announcing the div increase AM has been drifting down big time on a % basis.
Any thoughts on why?
Any thoughts on why?
Re: Antero Midstream Corp. (AM) for High Yield
No, but AR and AM s/b releasing Q1 results after the markets close today. AM's growth is primarily tied to AR's drilling program.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group