Wells Fargo Upgrades Enbridge Energy Management (EEQ) to Outperform; Recent Market Weakness Provides An Attractive Entry Point

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EEQ Hot Sheet

Rating Summary:
3 Buy, 2 Hold, 0 Sell

Rating Trend: Down

Down

Today's Overall Ratings:
Up: 16 | Down: 7 | New: 23

Wells Fargo upgraded Enbridge Energy Management (NYSE: EEQ) from Market Perform to Outperform with a price target range of $31-$33.

Wells analyst says, "Quarter-to-date, EEP and EEQ are down 5.2% and 9.3%, respectively, compared to a 4.3% decrease for the Wells Fargo Securities MLP Index (and a 7.3% decline for the S&P 500). Enbridge Energy Partners' (NYSE: EEP) aboveaverage yield, predominantly fee-based cash flow mix, and visible distribution growth profile should be attractive attributes in the currently challenging economic and low interest rate environment, in our view. EEP/EEQ remains well positioned to deliver annual distribution growth of 4% over the next 3 years (with upside potential tied to potential acquisitions). Distribution growth is supported by forecasted annual growth capex of $1.2B in 2011 and 2012 (and potentially $500MM per year thereafter). We forecast attractive potential upside of roughly 20% for EEP and 24% for EEQ based on our valuation range of $31-33 per unit for both companies."

For more ratings news on Enbridge Energy Management click here and for the rating history of Enbridge Energy Management click here.

Shares of Enbridge Energy Management closed at $27.54 yesterday, with a 52 week range of $25.76-$67.76.

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