Tesoro Corp. (TSO) PT Lifted to $88 at BofA/Merrill Lynch on MLP Upside

BofA/Merrill Lynch analyst Doug Leggate reiterated a Buy rating and boosted his price target on Tesoro Corporation (NYSE: TSO) to $88.00 (from $70.00) after the company's Analyst Day highlighted midstream as core to its investment case.

"Headline target EBITDA of ‘over $3bn’ by 2017 is worthy of attention and places TSO with a strong relative outlook in a sector that near term likely faces narrowing differentials on the US Gulf Coast and an increasingly unfavorable gasoline balance in contrast to a stable / improving market in TSO’s core California region," Leggate said.

The analyst said the potential value of its interests in TLLP, including the GP and projected ‘drop down’ value of some $500mm of potential EBITDA over time is equivalent to ~35% of our total estimate of fair value.

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

Shares of Tesoro Corporation closed at $76.93 yesterday.

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