Editor’s Note: For paying subscribers, please see at the bottom of this article for the links to the HFI Portfolio and HFIR Energy Income Portfolio. A detailed report of Arc Resources will be published soon.
By: Jon Costello
The HFIR Energy Income Portfolio came to own EQT (EQT) shares from its investment in Equitrans Midstream. I originally purchased Equitrans shares for $8.75 per share on July 11, 2023, due to its safe 6.5% yield and the value growth I believe would come once its Mountain Valley Pipeline was completed. Equitrans shares traded at a discount due to uncertainty surrounding the pipeline’s completion date.
EQT announced that it would acquire Equitrans on March 11, 2024, in an all-stock deal for the equivalent of $12.50 per Equitrans share when EQT shares traded at $37.18. for the equivalent. I wanted to hold the Equitrans shares long enough to qualify for long-term capital gains treatment. The deal closed on July 11.
Our 65.4% total return on our Equitrans investment over our 16.5-month holding period represents a 44.1% compound annual growth rate.