- NuStar Energy (NS +0.9%) and NuStar GP Holdings (NSH +1.1%) again are moving higher even as Credit Suisse downgrades both to Neutral from Outperform, after the stocks have jumped a respective 9% and 12% in recent days.
- The firm forecasts NS resuming distribution growth in Q1 2016 when coverage is expected to hover north of 1.1x, but favors moving to the sidelines after the recent run-up in favor of MLPs with faster distribution growth and longer-term visible growth relative to the sector amid the current cycle of weak commodity prices.
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On Friday, NS said its revenue dropped 13% in Q4 as increased volume from an expansion of the South Texas Crude Pipeline was unable to offset higher operating and general expenses, but earnings beat estimates due mostly to the pipeline and a recent acquisition.