Zacks Investment Research downgraded shares of Sunoco Logistics Partners, L.P. (SXL) from OUTPERFORM to NEUTRAL on March 14, 2013, with a target price of $70.00.
We are downgrading units of Sunoco Logistics Partners to Neutral from Outperform purely on valuation grounds, as we see limited near term price upside. Recent results have been driven by strength in its crude pipeline system and terminals facilities. Importantly, the partnership has grown its cash distribution for 31 consecutive quarters. With its stable fee-based revenue, geographically-diverse assets and strong business fundamentals, Sunoco Logistics offers investors an opportunity to capture income growth through steadily rising cash distributions and capital appreciation. However, tepid demand for refined products and the difficult operating environment remain key areas of concern, in our view. As such, we see the unit performing in line with the broader market.
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