Mizuho Securities Starts Tesoro Logistics (TLLP) at Buy

September 30, 2016 8:19 AM EDT
Get Alerts TLLP Hot Sheet
Price: $48.46 --0%

Rating Summary:
    11 Buy, 5 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 12 | Down: 18 | New: 4
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Mizuho Securities initiates coverage on Tesoro Logistics (NYSE: TLLP) with a Buy rating and a price target of $58.00.

Analyst Brian Zarahn commented, "We are initiating coverage of TLLP with a Buy rating and $58 price target. Our $58 price target is based on the average of our $58 discounted cash flow model (9.75% discount rate) and $58 EV/Adjusted EBITDA (13.5x multiple on 2017) valuation methodologies. TLLP offers a healthy yield, competitive growth at a reasonable price and a parent that continues to pursue midstream growth opportunities. While we expect TLLP’s distribution growth rate to decline from 17% in 2016 to a 9% CAGR through 2019 due to its larger size and GP distribution, we believe the stock is undervalued at current levels. We believe a potential catalyst in the next 1-2 years is a change in the GP distribution structure to improve TLLP’s equity cost of capital enhancing long-term growth prospects."

For an analyst ratings summary and ratings history on Tesoro Logistics click here. For more ratings news on Tesoro Logistics click here.

Shares of Tesoro Logistics closed at $48.36 yesterday.



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