Wed, Jul. 13, 10:40 AM
- Plains All American Pipeline (PAA -0.3%) and Plains GP Holdings (PAGP +0.1%) are both upgraded to Neutral from Underperform at Baird, which says the new ownership and governance structure is simpler and leaner, and the distribution cuts are credit positive and sustainable.
- Baird, which raises its price target on PAA to $30 from $14 and on PAGP to $12 from $5, says it holds PAA's execution capability in high regard and models above-market Permian volume capture and below-market declines elsewhere.
- But Wunderlich's Jeff Birnbaum thinks investors may be too optimistic about the near-term benefits of the simplification move, keeping his Hold rating on both units as "the stocks are already pricing in a significant cash flow recovery where there could still be substantial choppiness along the way."
Tue, Jul. 12, 12:54 PM
- Plains All American Pipeline (PAA +11.7%) and Plains GP Holdings (PAGP +11.4%) power higher following last night's agreement to simplify their ownership and governance structure.
- In the deal valued at ~$7.2B, PAA will issue 245.5M shares to an affiliate of PAGP in exchange for permanently eliminating PAGP's incentive distribution rights and other economic rights, and will give PAA unitholders the right to vote for a unified board of directors; at the expected closing of the deal in Q4, PAA also will assume $593M in debt from the affiliate.
- PAA will cut its dividend by 21% to $0.55/unit beginning in Q3, and PAGP will cut the dividend on its Class A units by 11% to $0.2065/share.
- PAGP will remain a publicly traded entity that is treated like a C-corp with a Form 1099 tax reporting structure; the companies say they received a tax opinion stating that the deal would not be taxable for PAA or to shareholders.
- Piper Jaffray analyst Brian Gamble says the deal appears to improve coverage metrics at PAA, and says PAA's distribution cut came in at the low end of his expectations of 20%-50%.
Fri, Jul. 8, 12:39 PM
- Plains GP Holdings (PAGP +0.7%) is downgraded to Equal Weight from Overweight at Barclays, while raising its price target on the stock to $11 from $8.
- Barclays believes Plains All American Pipeline (PAA +1.6%) is unlikely to be able to generate coverage above 1.0x for at least the next couple of years at current distribution levels, and probably will prompt a 25% distribution cut at PAGP.
- The firm reduces its 2017 dividend and target yield estimates to $0.69/share from $0.924 and to 6% from 11%, respectively.
Mon, Jun. 6, 9:11 AM
- Holly Energy Partners (NYSE:HEP) agrees to acquire a 50% interest in Cheyenne Pipeline for $42.5M.
- The 87-mile crude oil pipeline, which runs from Fort Laramie to Cheyenne in Wyoming, has a capacity of 80K bbl/day.
- The other 50% interest is owned by an affiliate of Plains All American Pipeline (NYSE:PAA), who will continue to operate Cheyenne.
Thu, May 26, 2:42 PM
- Little was said at today's investor day on the subject, but Barron's Amey Stone suspects investors are nervous that Plains All American Pipeline (PAA -1.7%) may consolidate its MLP with the general partner, Plains GP Holdings (PAGP -2.9%).
- One worry about a potential consolidation is that it will threaten the high distributions of the MLP, Wunderlich's Jeff Birnbaum says, and long-term holders also would worry about tax consequences in a restructuring.
- Birnbaum believes a deal would improve Plains’ financial outlook, "but choices will likely need to be made between PAA’s distribution and leverage," so he awaits a more attractive entry point alongside additional signs of upcoming volume growth.
- Now read Plains All American Pipeline, Plains GP kept Neutral at Credit Suisse
Thu, May 26, 12:58 PM
- Plains All American Pipeline (PAA -0.6%) and Plains GP Holdings (PAGP -3.3%) are reiterated with Neutral ratings and respective $26 and $11 price targets at Credit Suisse. which says the main takeaway from PAA's investor day was management's description of PAA's ongoing strategy of increasing integration and utilization of existing capacity.
- The firm says it was impressed with PAA's expectations to generate $1B by 2020 through leveraging its expansive footprint with little to no incremental capex; of the $1B, $600M was expected to come from the transportation and facilities segments, with $400M from supply and logistics.
- Credit Suisse expects margins to begin to recover significantly in 2018 and thereafter due to increasing crude margins and arbitrage opportunities.
- Now read Plains All American Pipeline and its distribution
Thu, May 19, 3:49 PM
- Plains All American Pipeline (PAA +2.8%) failed to detect and react quickly enough to last year's oil spill on the California coast a year ago and did not do enough to prevent corrosion, the U.S. Pipeline and Hazardous Materials Safety Administration says in its final investigation report.
- The agency previously said severe corrosion led to a 6-in. gash in the 2-ft.-wide pipe, but the final report examines in greater depth about failures to detect and prevent that corrosion as well as operator error in recognizing the leak.
- The report is issued on the one-year anniversary of the 120K-gallon spill and two days after PAA was indicted in Santa Barbara County Superior Court on several criminal charges, including four felonies for polluting state waters and three dozen misdemeanors for harming wildlife.
- Now read Plains All American reiterated Sell at Goldman
Thu, May 19, 2:44 PM
- Plains All American Pipeline (PAA +2.3%) is higher even as Goldman Sachs reiterates its Sell rating and $17 price target, saying Moody's credit downgrade puts PAA in danger of losing its investment grade rating and making it more difficult for the company to use leverage to expand.
- The firm also notes the increased potential for greater volume decline as PAA's Q1 rig count came in lower than expected (Q1 earnings).
- Goldman says it likes PAA's asset footprint and acknowledge its potential earnings power upside in a crude production recovery, but wants to see a resolution to its corporate structure and a clear path to deleveraging.
- Now read Plains' big yield: Sifting the MLP wreckage
Tue, May 17, 12:46 PM
- Plains All American Pipeline (PAA +2.2%) says the company and one of its employees have been indicted in the failure of a California crude oil pipeline last year.
- PAA and one of its employees face 46 counts of state law violations in the May 2015 spill at a beach on the Santa Barbara coastline and into the Pacific Ocean.
- PAA says the spill was an accident, that no criminal behavior occurred and that it will defend itself against the changes.
- Now read Plains' big yield: Sifting the MLP wreckage
Wed, May 4, 4:53 PM
Tue, May 3, 5:35 PM
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Thu, Apr. 28, 3:48 PM
- Marathon Petroleum (MPC -0.6%), which operates the 1.2M bbl/day Louisiana-to-Illinois Capline crude oil pipeline, likely will reverse the pipeline to move heavy Canadian crude south to Louisiana after oil prices recover from the current rout, Marathon Petroleum CEO Gary Heminger says.
- Volumes for the Capline pipeline, the largest in the U.S. and once a major artery to deliver imports and Gulf of Mexico crude to the U.S. midwest, have dropped sharply as U.S. shale output boomed before prices plunged.
- Plains All American Pipeline (PAA -3.9%), the line's majority owner, has said that its 600K bbl/day portion of Capline moved an average of 170K bbl/day last year; MPC and PAA support reversing Capline, but minority owner BP, which relies in part on the line to supply its massive Indiana refinery, has not signed off.
- Heminger says a reversed Capline would need to move a minimum of 500K bbl/day of Canadian heavy crude, but producers struggling with profit losses have cut spending and deferred projects.
- MPC shares are lower after Q1 earnings fell on weaker refining margins and revenue, as well as writedown at MPC’s MPLX (MPLX -0.4%) pipeline subsidiary.
- Now read Hidden gems that make Marathon Petroleum a buy
Thu, Apr. 7, 4:45 PM
Mon, Apr. 4, 9:17 AM
- Plains All American Pipeline (NYSE:PAA) agrees to acquire Spectra Energy's (NYSE:SE) Canadian natural gas liquids business for ~C$200M (US$150M).
- The deal includes the Empress NGL extraction and fractionation facility, the PTC transmission pipeline, seven NGL terminals and two NGL storage facilities in western Canada.
- PAA also says it is evaluating non-core asset sales and expects total asset sales for 2016 of $500M-$600M.
- Now read Spectra Energy is a safe midstream with an attractive yield
Fri, Apr. 1, 6:54 PM
- The huge investor outflow from MLPs has created a handful of major value opportunities in the space, Simmons analysts say, naming Enterprise Products Partners (NYSE:EPD) and Holly Energy Partners (NYSE:HEP) as their top Buy ideas.
- The firm believes that not all MLPs are as financially solid as they claim, preferring names that can fully cover current distribution payments and have financed growth projects in 2016 and EBITDA outlook clarity.
- Simmons also names EnLink Midstream Partners (NYSE:ENLK) as a higher risk/higher reward play for more aggressive investors; the firm rates ENLK, EPD, HEP and Delek Logistics Partners (NYSE:DKL) at Outperform.
- Rated Neutral: KMI, JPEP, NS, EEP, PAA, PAGP, OKS, ENLC.
- Now read High dividend stock has 46 dividend hikes, earnings estimates rising, insiders are buying
Fri, Apr. 1, 10:59 AM
- Holly Energy Partners (HEP -2.1%) agrees to acquire crude oil tankage located at HollyFrontier's (HFC -3.8%) Tulsa refinery from an affiliate of Plains All American Pipeline (PAA -2.1%) for $39.5M.
- In connection with the deal, HEP and HFC say they expect to enter into a 10-year throughput agreement containing minimum quarterly volume commitments from HFC.
- HEP expects the acquisition will generate minimum annual revenue of $6.1M in the first year and will be immediately accretive.
- Now read A high-dividend stock with 45 straight dividend hikes, insider buying and rising estimates
Plains All American Pipeline LP is engaged in the transportation, storage, terminal ling and marketing of crude oil, refined products and liquefied petroleum gas and other natural gas-related petroleum products. It operates through three business segments: Transportation, Facilities, and Supply... More
Sector: Basic Materials
Industry: Oil & Gas Pipelines
Country: United States
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