Figures seem to be stacking up right for North American provider of midstream energy services Enterprise Products Partners L.P. (NYSE:EPD). The Houston-based company, which owns and operates the natural gas liquids (NGLs) sector of Enterprise Products Company (EPCO), received a go signal from Deutsche Bank when the Germany-headquartered investment analysts issued a note to investors stating that the multinational firm has a “buy” rating. The target price increased from $60 to $62, and trading closed with a notable +.80%. Does this mean you should trade EPD? Read on.
The most recent earnings data released by Enterprise Products Partners last November stated that the company had a $0.66 EPS for the quarter; $0.06 more than what Thomson Reuters initially predicted. Although the company’s quarterly income dipped 7.6% lower based on an annual basis, overall, analysts are still quite optimistic that Enterprise Products Partners will merit at least $2.62 in profits per share for the current fiscal year, with stocks gaining almost fourteen percent. This comes after news that one of its subsidiaries will transport goods for another subsidiary, SeaRiver of ExxonMobil Corporation, for the latter’s United States operations for a yet unspecified number of years starting the first of January, 2013.
Zacks analysts are evidently in agreement as they confirmed a “buy” rating on the company’s shares. Investment analysts at Credit Suisse, meanwhile, are much more confident: they gave an “outperform” rating and even raised the target price on shares from $60 to $61. This is possibly another positive result generated by news of its Seaway Pipeline joint venture with Enbridge, Incorporated and other smaller players; in addition to plans of a 580-mile-long NGL pipeline to be laid across the Lake Houston Wilderness Park.
Kinder Morgan Inc (NYSE:KMI)
The numbers and ratings for rival company Kinder Morgan the world’s largest pipeline conglomerate, are a mixed bag. With a $39 target price, Zacks gave the energy transportation, storage, and distribution company, a neutral rating. An analyst of the said notable investment research firm reiterated that they are “maintaining long-term recommendation on Kinder Morgan at neutral, ahead of its fourth quarter results” which means that the company is likely to onto hold that slot in the near future. This is surprising, coming from Zacks, especially as KMI’s acquisition of El Paso Corporation contributed heavily to being named the biggest in terms of being a pipeline conglomerate. Furthermore, this acquisition also helped multiply the company’s fourth-quarter revenue to more than double of the previous year, in addition to the ever-present demand for natural gas. KMI even exceeded Zacks’ estimate of $0.67 by at least $0.08. Quarterly results were also higher by more than 36%, mainly due to the pipeline network’s expanded distribution. While Deutsche Bank posted a “buy” rating on the company with target price on shares from $45 to $48, The Street also confirmed a somewhat confusing “sell” rating for Kinder Morgan.