Meliora’s MLP Strategy
Master Limited Partnerships (MLPs) are publicly traded just like stocks, but are structured as partnerships, and as such are not subject to corporate taxation. MLP income is taxed only once, at the partner level. Most MLPs are natural resource-related companies because the U.S. tax code largely restricts the MLP structure to “qualifying income” related to the development and marketing of natural resources.
MLPs typically pay out the vast majority of the cash flow they generate each quarter. This makes them an attractive sector for dividend-oriented investors.
Meliora’s MLP Strategy focuses on the midstream energy sector as we view it as the most structurally suitable sector, due to its long-lived assets and relatively stable cash flow profile. The following are some elements that set Meliora apart:
In-Depth Financial Analysis
- Valuation (Relative to Peers and History)
- Cash Flow Profile
- Cost of Capital
- Balance Sheet Strength
Knowledge of Industry Dynamics
- Extensive industry contacts
- Centrally located near many MLP headquarters
- Access to portfolio managers
- Meliora-managed separate accounts retain attractive tax benefits given up by publicly available MLP funds.
Please contact us for more detailed information about our MLP Strategy, including its risk factors.