In a recent transaction, EIG Veteran Equity Aggregator, L.P., a major stakeholder in USA Compression Partners, LP (NYSE:USAC), has sold a significant number of shares in the company. The partnership offloaded a total of 11,427 common units across two separate transactions, with the total value of the sales amounting to approximately $274,752.
The sales occurred on June 10 and June 11, with prices per share ranging from $24.03 to $24.0445. On the first day, EIG Veteran Equity Aggregator sold 11,175 shares at a price of $24.0445 per share. The following day, an additional 252 shares were sold at a slightly lower price of $24.03 each.
Following these transactions, EIG Veteran Equity Aggregator's holdings in USA Compression Partners decreased to 5,530,698 common units. The partnership, known for its status as a ten percent owner of the company, has adjusted its position in the natural gas transmission firm, as indicated by the reported sales.
Investors and market watchers often look to the buying and selling activities of major stakeholders for indications of their confidence in the company's future performance. Transactions such as these are publicly disclosed to ensure transparency and provide the market with essential information.
USA Compression Partners, headquartered in Austin, Texas, specializes in natural gas transmission services and is recognized within the industry for its operations. The company's common units are traded on the New York Stock Exchange under the ticker symbol NYSE:USAC.
The disclosed sales were signed off by Matthew Hartman, Managing Director, and Nick Williams, Senior Vice President, on behalf of EIG Veteran Equity Aggregator, L.P. This move comes as part of the regular financial activities that stakeholders engage in, reflecting the dynamic nature of the stock market and investment strategies.
In other recent news, USA Compression Partners has been making significant strides. The company's first-quarter results for 2024 were record-breaking, with notable increases in revenue, adjusted gross margin, adjusted EBITDA, and distributable cash flow. This impressive performance was attributed to strategic capital deployment and demand-driven pricing. In addition, the company has been successful in restructuring their capital, issuing and redeeming senior notes, converting preferred units to common, and focusing on reducing leverage to stabilize cash flows.
In a recent turn of events, Mizuho Securities upgraded USA Compression Partners from Underperform to Neutral, setting a price target of $26.00. This upgrade was prompted by the company's strong operational performance, which is expected to continue, backed by a tight compression market that supports higher unit margins, longer contract durations, and improved fleet utilization. The company's recent shift towards balance sheet simplification was also noted as a positive move that could attract new investors.
These are recent developments, and it is clear that USA Compression Partners is making strategic moves in the market. The company's disciplined approach to growth and capital expenditure, despite the uncertain economic climate, reflects a commitment to long-term stability and shareholder value.
InvestingPro Insights
Amidst the recent sale of shares by EIG Veteran Equity Aggregator, L.P. in USA Compression Partners, LP (NYSE:USAC), investors are keen to understand the underlying financial health and future prospects of the company. The following insights, derived from InvestingPro, provide a snapshot of USAC's current market position and performance metrics that could influence investor sentiment.
With a market capitalization of $2.78 billion, USA Compression Partners exhibits a robust presence in the industry. Despite operating with a significant debt burden, as noted in one of the InvestingPro Tips, the company has been able to maintain dividend payments for seven consecutive years, which is indicative of its commitment to returning value to shareholders. The current dividend yield stands at an attractive 8.83%, which is particularly appealing for income-focused investors.
The company's P/E ratio, as of the last twelve months ending Q1 2024, is 58.04, reflecting a high earnings multiple that may raise questions about valuation. However, the PEG ratio, which measures the price of a stock relative to its earnings growth, is at a low 0.15, suggesting that the company's earnings growth could potentially justify the higher P/E ratio. This aligns with the InvestingPro Tip that points out USAC is trading at a low P/E ratio relative to near-term earnings growth, indicating that investors may expect better earnings performance in the near future.
Revenue growth also remains a strong point for USAC, with an 18.96% increase over the last twelve months as of Q1 2024. This growth trajectory is further supported by a gross profit margin of 67.05%, which underscores the company's ability to maintain profitability despite broader market challenges.
For those interested in a deeper analysis, there are additional InvestingPro Tips available, which can provide further insights into USA Compression Partners' financial health and market performance. To explore these tips and more detailed metrics, visit InvestingPro's USAC page. Remember to use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, offering you a comprehensive investment tool at a discounted rate.
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