UBS Cuts Price Target as Genesis Energy (GEL) Faces Headwinds

UBS maintained a Buy rating on Genesis Energy LP (NYSE: GEL), and cut the price target to $52.00 (from $56.00), following the company's 4Q earnings report. GEL reported Adjusted EBITDA of $140.5mm, which was in line with UBSe of $141.2mm.

Analyst Shneur Gershuni commented, "Management highlighted several headwinds that account for ~$15mm/qtr of earnings risks including lower demand for heavy fuels due to the shale revolution and better market balance for asphalt, ~30,000/qtr of lower pipeline loss allowance due to lower crude prices, and competitive pressures on the blue water barges. Offsetting these are strong volume growth in on-shore and off-shore pipelines, which benefited from the Enterprise acquisition and new fields in the Gulf coming on line as well as the initial throughput on the new Wyoming pipeline. GEL doesn't need to access the capital markets to fund growth and currently will not have to enter the debt market before its first debt maturity in July 2019."

For an analyst ratings summary and ratings history on Genesis Energy LP click here. For more ratings news on Genesis Energy LP click here.

Shares of Genesis Energy LP closed at $24.28 yesterday.

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