UPDATE: Oppenheimer Downgrades SandRidge Mississippian Trust I to Underperform on Disappointing 1Q13 Income

In a report published Friday, Oppenheimer analyst Daniel Katzenberg downgraded the rating on SandRidge Mississippian Trust I SDT from Perform to Underperform. In the report, Katzenberg noted, “SDT announced that its 1Q13 income available for distribution was just $0.5682/unit, forcing it to pay the subordination threshold of $0.5904 per common unit and $0.5015 per subordinated unit. This distribution was 20% below the target distribution of $0.738/unit. The disappointing results were due to production below our estimate and an oil/gas mix more weighted to natural gas than originally forecast. With an IRR projected at just 3%, and a fair value of $11-13/unit, we believe other MLP investments offer more attractive opportunities, at much less risk, and are therefore downgrading our rating on SDT to Underperform.” SandRidge Mississippian Trust I closed on Thursday at $13.76.