Third Stock Pick

Today, I got in Energy Transfer Partners, L.P. (ETP) at $52.14 (even though my LO is $52.15 - I must have typed a "4" instead of a "5".. lucky for me).

I got charged the standard $9.95 commission for the trade. So total transaction is $62.09

I first heard about ETP from Jim Cramer's Mad Money. What struck me with the stock is the dividend yield of 6.70% which considered high.  this made me think if the stock is an accidental high yielder... maybe so.  So After I waited the standard two day grace period (to avoid the "Cramer Bump"), I Put in my LO and got in my position.

I got the stock due to high dividend yield and as my Natural Gas play.  Due to the Nuclear disaster in Japan and the Middle East Tensions,  I predict that Oil and Natural Gas will spike in prices as we lead in to the Spring and Summer months (Lots of people would be driving). As Cramer repeatedly mentioned in his show, Natural Gas is a more practical bridge fuel for our cars and energy use than solar and wind energy.  Also, the USA has a surplus or Natural Gas that we may EXPORT some to other countries.

Also, ETP makes their money thru Natural Gas Midstream, intrastate transport and storage in the US plus they also have a network of retail Propane Gas stores.  ETP's debt mostly consists of investments in pipelines and discovering new sources of Natural Gas.  As mentioned in their 10k report, ETP knows that failure to invest in pipelines and new sources of Natural Gas will severely damage their gross margins and market growth.  Therefore, even though I do not like companies with a lot of debt outstanding, the reasons ETP gave sounds reasonable and is necessary to further their growth and competitive edge.

However, I will keep a watchful eye on this stock.  My goal is to own 10 shares of ETP by 12/31/11. I would sell if the following happens: 1) Dividend is cut/ Eliminated 2) Government regulations hinder or hurt the adaptation of Natural Gas as a viable alternative source of energy.

Exit strategy is my standard 10% gain or the stock reaching a high of $60.