Midstream Companies’ Moving Averages and Analysts’ Estimates
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Moving averages
As of December 18, 2015, the 100-day moving averages of many midstream companies’ stocks showed strong resistance. For example, all of the midstream companies in the following table were trading below their 100-day moving averages. Midstream companies are trading 31% below their 100-day moving averages on an average basis.
Kinder Morgan (KMI) and Williams Companies (WMB) were trading 45.6% and 47%, respectively, below their 100-day moving averages as of December 18. Midstream companies were also trading well below their 20-day moving averages.
Only Magellan Midstream Partners (MMP) and Spectra Energy Partners (SEP) managed to trade 1.6% and 1.49%, respectively, above their 20-day moving averages as of December 18. This is close compared to other midstream companies. The Energy Select Sector SPDR Fund (XLE) was trading 8.5% below its 20-day moving average.
Wall Street analysts’ consensus estimate
Wall Street analysts’ consensus estimate suggests a 70% upside for these midstream companies compared to a 55% upside for large-cap upstream companies. Over the next 12 months, midstream operators Williams Companies and Energy Transfers Partners (ETP) could see rises of 92% and 83%, respectively, from their levels as of December 18. Below is a rundown of three other midstream operators and Wall Street analysts’ estimate for each company over the next 12 months:
Kinder Morgan could see a 42% rise.
Spectra Energy could see a 52% rise.
Williams Partners (WPZ) could see a 68% rise.
Interestingly, the forward PE (price-to-earnings ratio) for the next year suggests that Energy Transfer Partners and Williams Partners are cheaper than other MLPs.
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