Goldman Sachs Upgrades NuStar Energy L.P. (NS) to Buy

March 14, 2014 6:58 AM EDT
Get Alerts NS Hot Sheet
Price: $53.97 +0.58%

Rating Summary:
    5 Buy, 8 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 18 | Down: 19 | New: 11
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Goldman Sachs upgraded NuStar Energy L.P. (NYSE: NS) from Neutral to Buy with a price target of $62.00 (from $49.00).

Analyst Steve Sherowski said, "NS units have underperformed the AMZ by 1.4% over the past twelve months and its yield is currently trading 240 bps above MLPs under coverage. However, following 10 consecutive quarters of no distribution growth, including 9 in which distributions exceeded cash flow, we believe fee-based growth driven by its Eagle Ford project backlog will put it back on track for positive distribution coverage in 2H14 and for distribution increases by mid-2015." He added, "We believe NS units will be rewarded with a higher valuation as project- driven cash flow growth visibility improves throughout 2014."

The firm lowered 2014 EPU by 2.5% to $1.95 but raised 2015/2016 4-5% to $2.70/$2.90, respectively.

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

Shares of NuStar Energy L.P. closed at $52.14 yesterday.

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