Barclays Maintains an 'Overweight' on Energy Transfer Equity (ETE); Completes SUG Acquisition

May 15, 2012 2:57 PM EDT
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Price: $18.60 --0%

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Barclays maintains an 'Overweight' on Energy Transfer Equity, L.P. (NYSE: ETE) price target of $46.00.

Analyst, Richard Gross, said, "We are adjusting our model taking into account Q1 performance of the recently acquired SUG assets. SUG generated Q1 EBITDA of $222 mm (flat YoY) ex-merger related expense of $53 mm...We are reducing our SUG DCF forecast as we continue to assume maintenance capex in the 30% of EBITDA range, which may have upside depending on how ETE accounts for SUG asset maintenance capex going forward."

"...we continue to believe that potential SUG asset drop downs to Energy Transfer Partners (NYSE: ETP) / Regency Energy Partners (NYSE: RGP) will be highly accretive for ETE unit holders and continue to forecast 15% annual distribution growth in 2013-2016, when we expect these transactions to materialize." (Barclays lowers FY12 EPS estimate from $2.63 to $2.50 and FY13 from $3.02 to $2.88)

For an analyst ratings summary and ratings history on Energy Transfer Equity, L.P. click here. For more ratings news on Energy Transfer Equity, L.P. click here.

Shares of Energy Transfer Equity, L.P. closed at $39.33 yesterday.

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