ClearBridge Energy Midstream Opportunity Fund Inc. Announces Unaudited Balance Sheet Information as of May 31, 2024
ClearBridge Energy Midstream Opportunity Fund (NYSE: EMO) announced its unaudited financials as of May 31, 2024. The Fund reported net assets of $567.7 million and a net asset value (NAV) per share of $44.39. Investments totaled $588.9 million, with cash and equivalents at $38.1 million. The asset coverage ratio for senior indebtedness was 2,939%, and for total leverage, it was 1,058%. Major holdings included Energy Transfer LP, Targa Resources Corp, and ONEOK Inc., comprising a significant portion of the investment portfolio. Managed by Franklin Templeton Fund Adviser and ClearBridge Investments, the Fund provides semi-annual and annual reports to the SEC.
- Net assets reported at $567.7 million, indicating financial stability.
- Net asset value (NAV) per share at $44.39.
- High asset coverage ratios: 2,939% for senior indebtedness and 1,058% for total leverage, indicating robust financial health.
- Investments totaled $588.9 million, suggesting substantial portfolio value.
- Top ten equity holdings make up 76.9% of total equity investments, indicating concentrated, potentially high-performing investments.
- Unaudited financial data, which can lack accuracy.
- Total leverage stands at $59.2 million, potentially increasing financial risk.
- Deferred tax liability of $2.1 million and other liabilities at $1.6 million may affect future cash flows.
Insights
The ClearBridge Energy Midstream Opportunity Fund's unaudited balance sheet as of May 31, 2024, offers several critical insights into its financial health and performance. The fund reports
However, it's also important to consider the nature of the investments. The fund's heavy concentration in a few energy sector companies like Energy Transfer LP and Targa Resources Corp., which make up a significant portion of the portfolio, implies sector-specific risks. While energy infrastructure can be lucrative, it's also subject to volatility due to fluctuating commodity prices and regulatory changes. Investors should weigh this concentration risk against the potential for high returns.
Overall, the financials appear strong, but sector concentration remains a key factor for prospective investors to monitor.
Examining the investment landscape, the ClearBridge Energy Midstream Opportunity Fund's focus on energy sector companies can be seen as both a strength and a potential vulnerability. The energy sector has historically been characterized by high yield potential; however, it also comes with volatility linked to changes in oil and gas prices as well as evolving energy policies. The top ten holdings, which constitute 76.9% of the fund’s equity investments, reflect a robust positioning in American midstream energy companies. These companies, like Energy Transfer LP and ONEOK Inc., have substantial infrastructure assets that benefit from stable cash flows, providing a cushion against market downturns.
From a market analysis perspective, the fund's strategy aligns with current trends favoring energy infrastructure investments. However, the fund’s narrow sector focus means that it is less diversified, potentially increasing its sensitivity to sector-specific downturns. For the retail investor, this concentration could mean higher short-term returns during sector booms but also higher risk during busts.
Thus, while the fund's financials are strong, investors should remain aware of the inherent sector concentration risks.
As of May 31, 2024, the Fund’s net assets were
| As of May 31, 2024 | ||||||
| Amount (millions) | Per Share | |||||
| Investments | $ |
588.9 |
$ |
46.05 |
|
|
| Cash and Cash Equivalents |
|
38.1 |
|
2.98 |
|
|
| Other Assets |
|
3.6 |
|
0.28 |
|
|
| Total Assets | $ |
630.6 |
$ |
49.31 |
|
|
| Senior Notes* | $ |
21.3 |
$ |
1.67 |
|
|
| Mandatory Redeemable Preferred Shares* |
|
37.9 |
|
2.96 |
|
|
| Total Leverage | $ |
59.2 |
$ |
4.63 |
|
|
| Deferred Tax Liability | $ |
2.1 |
$ |
0.16 |
|
|
| Other Liabilities |
|
1.6 |
|
0.13 |
|
|
| Total Liabilities | $ |
3.7 |
$ |
0.29 |
|
|
| Net Assets | $ |
567.7 |
$ |
44.39 |
|
|
| Outstanding Shares |
|
12,787,291 |
||||
| * The Fund's asset coverage ratio under the 1940 Act with respect to senior indebtedness was 2, |
||||||
| * The Fund's asset coverage ratio under the 1940 Act with respect to total leverage was 1, |
||||||
| Top Ten Equity Holdings (as of May 31, 2024)** | ||||||
| Market Value | ||||||
| Name | (millions) | % of Investments | ||||
| Energy Transfer LP | $ |
71.8 |
|
12.2 |
% |
|
| Targa Resources Corp. | $ |
66.8 |
|
11.3 |
% |
|
| ONEOK Inc. | $ |
65.3 |
|
11.1 |
% |
|
| Enterprise Products Partners LP | $ |
53.6 |
|
9.1 |
% |
|
| Williams Cos. Inc. | $ |
43.4 |
|
7.4 |
% |
|
| Plains All American Pipeline LP | $ |
37.0 |
|
6.3 |
% |
|
| Enbridge Inc. | $ |
32.7 |
|
5.6 |
% |
|
| Western Midstream Partners LP | $ |
31.2 |
|
5.3 |
% |
|
| MPLX LP | $ |
30.6 |
|
5.2 |
% |
|
| Kinder Morgan Inc. | $ |
20.2 |
|
3.4 |
% |
|
$ |
452.6 |
|
76.9 |
% |
||
| ** Subject to change at any time | ||||||
| *** Percent of Total Equity Investments | ||||||
ClearBridge Energy Midstream Opportunity Fund Inc. is a non-diversified, closed-end management investment company, which is advised by Franklin Templeton Fund Adviser, LLC (“FTFA”) (formerly known as Legg Mason Partners Fund Advisor, LLC) and subadvised by ClearBridge Investments, LLC (“ClearBridge”). FTFA and ClearBridge are indirect, wholly-owned subsidiaries of Franklin Resources, Inc. (“Franklin Resources”).
This financial data is unaudited.
The Fund files its semi-annual and annual reports with the Securities and Exchange Commission (“SEC”), as well as its complete schedule of portfolio holdings for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. These reports are available on the SEC’s website at www.sec.gov. To obtain information on Form N-PORT or a semi-annual or annual report from the Fund, shareholders can call 1-888-777-0102.
For more information about the Fund, please call 1-888-777-0102 or consult the Fund’s website at www.franklintempleton.com/investments/options/closed-end-funds. Hard copies of the Fund’s complete audited financial statements are available free of charge upon request.
Data and commentary provided in this press release are for informational purposes only. Franklin Resources and its affiliates do not engage in selling shares of the Fund.
Category: Financials
Source: Franklin Resources, Inc.
Source: Legg Mason Closed End Funds
View source version on businesswire.com: https://www.businesswire.com/news/home/20240607716240/en/
Investor Contact: Fund Investor Services 1-888-777-0102
Source: Franklin Resources, Inc. and Legg Mason Closed End Funds
FAQ
What is the net asset value (NAV) per share of EMO as of May 31, 2024?
How much are the net assets of ClearBridge Energy Midstream Opportunity Fund as of May 31, 2024?
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What is the total leverage of EMO as of May 31, 2024?
