The MLP sector has been one of the most beaten-down sectors in 2017. While the broader energy sector, as represented by the Energy Select Sector SPDR ETF (XLE), has fallen nearly 11% so far in 2017, the Alerian MLP ETF (AMLP) has fallen almost 21%. The energy sector has strengthened since late August thanks to stronger crude oil prices. However, MLPs have not followed the recovery in the broader energy sector over the last two months.
The above chart shows this divergence. The lower-than-expected recovery for MLPs may be due to tax-loss selling as well as uncertainty over crude oil price sustainability. Notably, the SPDR S&P 500 ETF (SPY) (SPX-INDEX) has risen 13% year-to-date.
Top MLP gainers
Whereas the MLP sector has been mostly down, some MLPs have posted handsome year-to-date gains. In this series, we’ll discuss what’s driven the performance of these MLPs during the year. Calumet Specialty Products Partners (CLMT) stock has more than doubled in 2017, making it the top MLP gainer for the year.
Up 46% so far in 2017, Noble Midstream Partners (NBLX) is the second top MLP gainer. Alon USA Partners (ALDW) is the third top gainer in 2017, with a year-to-date rise of 41%. The above graph shows this year’s top ten MLP gainers as of November 14, 2017. The list includes MLPs involved in oil, gas, and related products, and excludes marine transportation MLPs. Let’s begin by looking at the top MLP gainer so far in 2017, Calumet Specialty Products Partners.