Ferrellgas Partners (FGP): Cutting Ests And Reiterating Sell - UBS
- Stocks dip as earnings pour in, consumer discretionary lags
- UPDATE: Alphabet (GOOG) Tops Q3 EPS Views; Revs Strong
- Baker Hughes (BHI), General Electric (GE) in Partnership Talks, Not Merger Talks
- Cirrus Logic, Inc. (CRUS) Q2 Results and Guidance Beat Estimates
- Amazon.com (AMZN) Misses Q3 EPS by 26c, Offers Q4 Guidance
Find out which companies are about to raise their dividend well before the news hits the Street with StreetInsider.com's Dividend Insider Elite. Sign-up for a FREE trial here.
UBS analyst, Shneur Gershuni, reiterated his Sell rating on shares of Ferrellgas Partners LP (NYSE: FGP) and cut his price target to $10 from $15 after FGP reported that due to increased leverage and higher debt levels, from weaker propane due to warmer weather and midstream operations, that its board could reduce its distribution from $2.05 to roughly $1.00/unit on an annualized basis.
This decision is not final, but is an option to reduce debt and leverage ratio. FGP also announced an amendment to its credit facility in which its leverage ratio was increased to 5.95x-6.05x over the next six quarters from 5.50x currently.
On September 1st, FGP also announced the termination of its agreement with Jamex, and FGP noted in its 10K that it does not expect Jamex or Bridgers largest customer to have any material contribution to EBITDA or revenue in the future.
The analyst, cut 2017/18/19 Adj. EBITDA estimates to $313/$316/$324MM from $359/$369/$377MM on the cancellation of the Jamex contract and further headwinds expected in FGP's midstream segment.
He cut 2017/18/19 DPU estimates to $1.00/$1.00/$1.00/unit from $2.05/$2.05/$2.05/unit on our expectation that the board will choose to move forward with a distribution cut, as a way to reduce both debt and its leverage ratio.
Shares of Ferrellgas Partners LP closed at $13.00 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Mizuho Securities Downgrades Community Health (CYH) to Underperform
- Jefferies Cuts Price Target on Parexel (PRXL) to $67 Following Weak 1Q
- Jefferies Raises Price Target on Exelon Corp. (EXC) Following 3Q EPS Beat
Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst PT Change, Short Sales
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!