Plains All American Pipeline LP (PAA) continued with its practice of sharing more benefits with its unitholders through the increase of the cash distribution rate. The partnership announced a new quarterly cash distribution rate of 98.25 cents per unit on all of its outstanding limited partner units.
The new distribution reflects a 1.3% growth over the quarterly distribution of 97 cents per unit paid in May 2011 and an increase of 4.2% from the quarterly distribution of 94.25 cents per unit paid in August 2010. The new distribution will be paid on August 12, 2011 to unit holders of record as of August 2, 2011.
The partnership has a long history of increasing distributions to unit holders. With this distribution, Plains has increased the quarterly distribution to limited partners in 27 out of the past 29 quarters. Plains' consistent hike in distribution bespeaks the partnership's commitment to provide increasing returns to unit holders, leveraging its profitable assets.
Plains reported strong first quarter results which surpassed the year-ago performance as well as the Zacks Consensus expectation. The partnership is optimistic about maintaining its growth momentum for the remainder of the year and hence raised its 2011 fully-adjusted EBITDA guidance by $75 million to a mid-point of $1.3 billion.
EnterpriseProducts Partners LP (EPD), a Plains All American peer, also increased its quarterly cash distribution rate in April 2011. The increased quarterly distribution of 59.75 cents per unit, paid in May 2011, represented a growth of 5.3% over the quarterly distribution of 56.75 per unit paid in May 2010 and an increase of 1.3% from the quarterly distribution of 59 cents per unit paid in February 2011.
Plains All American Pipeline currently retains a Zacks #3 Rank (short-term Hold rating). We also maintain a long-term Neutral rating on the stock.
Houston, Texasbased Plains All American is engaged in the transportation, storage, terminalling and marketing of crude oil, refined products and liquefied petroleum gas and other natural gas related petroleum products. The partnership is also involved in the development and operation of natural gas storage facilities.
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