Oppenheimer Raises PT on Top Midstream MLP Pick, Plains All American (PAA)

August 9, 2012 11:09 AM EDT Send to a Friend
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Price: $57.35 -2.23%

Rating Summary:
    16 Buy, 4 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 26 | Down: 32 | New: 6
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Today Oppenheimer reiterated an Outperform rating on Plains All American (NYSE: PAA) and raised their price target of $98.00 (from $90.00).

PAA owns and operates a vast network of geographically diverse midstream energy infrastructure focused mainly on crude oil transportation. The company provides services that are essential to the health of the US economy. PAA's revenue stream is predominantly fee-based, it has an investment-grade balance sheet and promising growth prospects both expanding key crude oil market hubs and growing PAA Natural Gas Storage (PNG), for which it owns the incentive distribution rights (IDRs).

“We believe that the units are a compelling value at the current price for long-term investors.” Said Katzenberg.

Today’s Oppenheimer report also noted that PAA reported 2Q12 results that beat expectations as all three business segments were above prior guidance. The strong second-quarter results led to a 2% increase in full-year EBITDA guidance, which is now expected to be ~$1.86B. Oppenheimer is forecasting distribution growth of 8.2% this year and 7.4% in 2013, well above peer group averages of 4.5% and 6.5%, respectively.

“PAA continues to be one of our top midstream MLP picks, based on its high leverage to liquids, strong distribution growth outlook and impressive track record of consistently topping Street expectations,” said Daniel Katzenberg

For an analyst ratings summary and ratings history on Plains All American click here. For more ratings news on Plains All American click here.

Shares of Plains All American closed at $85.68 yesterday.




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