Dallas, Texas 11/14/2013 (Financialstrend) – Denbury Resources Inc. (NYSE:DNR) is an S&P 500 index tracked stock. Over the past few quarters the independent oil and gas producer has been under the pump with respect to continued erosion in the value of the stock. In the past few week’s expectations were building around the firm’s much talked about restricting plan designed to help the firm turn the corner and restart paying back share holder value. But investors who were hoping to hear some break through announcement during the company’s 2013 were disappointed when the company press note stated that “the company would not pursue a master limited partnership (MLP) as it would bring no clear long-term benefit for Denbury shareholders.”
Commenting about the firm decision not to change course at this state, Denbury Resources Inc. (NYSE:DNR) chief executive Phil Rykhoek has been quoted to have said, “Our shift to a growth and income company does not contemplate any changes to our corporate structure or the creation of a master limited partnership, since we are not satisfied that any such changes would create a significant and sustained increase in shareholder value.”
Trade analysts who have tracked the Denbury Resources Inc. (NYSE:DNR) stock for a while now, had been recommending a tinkering with the master limited partnership so that the oil and gas firm would have managed to raise additional capital from a strategic partner. Analysts have been pushing the firm to announce a round of share buybacks and up its dividend yield in order to retain share holder value. In its commentary as to why it did not opt for a change in its partnership agreement, Denbury Resources Inc. (NYSE:DNR) had indicated that they feared potential increase in tax liability and also a chance of constrained cash flow. It also had anticipated operational complexity and possibility of increased debt showing up on its balance sheet also prevented the firm from going ahead with a change to its master limited partnership agreement.