Wells Fargo Raises Valuation Range on Plains All American (PAA) Following Series of Acquisitions

Wells Fargo is reiterating its Outperform rating on shares of Plains All American (NYSE: PAA) and is increasing its valuation range from $69-$73 to $71-$75 following a series of acquisitions.

The company announced five acquisitions in total valued at $2.3 billion. The firm breaks down the acquisition with PAA paying $1.67 billion for BP’s (NYSE: BP) NGL business, $388 million for the Gardendale Gathering system, $220 million for the Yorktown terminal and Jal pipeline, and $12 million for the Canadian Trucking
business. Wells Fargo also notes, "PAA has earmarked $200 million of growth capex spending for the acquired assets over the next two years."

The firm calls the series of acquisitions "a clear positive for PAA." Wells Fargo forecasts the deal could generate an extra $0.21-$0.24 per share in earnings.

Wells Fargo s increasing its FY11 and FY12 EPS estimates from $6.00 and $5.68 to $6.25 and $5.75.

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 $66.71 yesterday.

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