Enterprise Products Partners—Energy MLP: 2Q15 Earnings Outlook
Analysts’ recommendations
Of the analysts surveyed by Bloomberg, 89% rate Enterprise Products Partners (EPD) a “buy,” and 7% rate the stock a “hold.” Only ~4% rate it a “sell.” The consensus target price for the stock is $40, but it’s currently trading at $28.10. If the stock indeed attains this target price within a year, it would mean a 42% return for investors.
Individual ratings
Some broker recommendations and target prices are discussed here:
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Ladenburg Thalmann recommends Enterprise Products as a strong buy and sets a target price of $47 within a year. This target would imply an upside of 67% based on its current price.
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UBS (UBS) recommends the stock as a strong buy, with a target price close to the consensus price of $40.
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Global Hunter Securities has recommended EPD as a strong buy, with a target price of $42 within a year.
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Jefferies recommends it as a strong buy, setting a target price of $36 within a year.
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Raymond James recommends EPD as a strong buy, but with a more conservative price target of $35 within a year. This would still mean an annualized return of ~25% based on current levels.
The above table shows recommendations and target prices for Enterprise Products from some of the brokers surveyed. Peers Williams Partners (WPZ) and Energy Transfer Partners (ETP) have buy ratings from ~44% and 73%, respectively, of surveyed analysts. Enbridge Energy Partners (EEP) has hold ratings from 67% of the surveyed analysts.
EPD forms 9.9% of the Alerian MLP ETF (AMLP) and is its largest holding. MarkWest Energy (MWE) is the ETF’s second-largest holding, making up 8.6% of its portfolio.
In addition to the company-specific factors discussed in this series, commodity prices are always likely to impact the stock performance of energy sector MLPs like EPD.
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