Heckmann Corporation (HEK), Mesabi Trust (MSB): 2 Shale Plays and 1 Mining Ironman

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Environmental concerns have become a significant financial element of mining as regulations continue to get more stringent. Deploying capital in a company that profits from helping miners and drillers to meet these regulations has huge potential. To accomplish this task, the company has amassed a fleet of 200 rail cars, 1,200 trucks, 46 waste-disposal wells and 4,200 frack tanks. With a market capitalization over $1 billion, the company is a significant operation. Given current trends, it’s hard to imagine how you might not profit by betting on a company that relies on increasing oversight and regulation.

Mesabi Trust: This entity, which is a subsidiary of Cliff Natural Resources , has three characteristics for anyone thinking about investing in a trust. First, the underlying cash flow Mesabi Trust (NYSE:MSB) generates is sustainable and relatively stable. The company announced its February distribution in January, seeing the number fall from $0.76 to $0.49 on a year-over-year basis. This decrease was primarily the result of a 19% decline in the average price per ton that the trust received for the iron it sold during the quarter. While this seems like a significant drop, relative to many other commodities, it is manageable.

The next attractive feature of Mesabi Trust (NYSE:MSB) is that the trust has integrity and longevity as a legal entity. You must pay attention to how long the trust will continue to operate when you make an investment — Mesabi Trust (NYSE:MSB) has a minimum of 21 years ahead of it, so this feature is well covered. Lastly, the trust pays a significant dividend, currently 8.5%. Given the available yield in the market, and the other attractive features of the trust, this is a hugely compelling reason to have an allocation to this iron machine.

The article 2 Shale Plays and 1 Mining Ironman originally appeared on Fool.com.

Fool contributor Doug Ehrman has no position in any stocks mentioned. The Motley Fool owns shares of and has options on Heckmann.

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