On Dec 4, 2014, we issued an updated research report on Magellan Midstream Partners LP (MMP). The Tulsa, OK-based publicly traded energy pipeline partnership expects fourth-quarter 2014 earnings per unit to be more than the year-ago profit.
This signifies the partnership’s positive outlook on the back of solid operating performances – reflected in the current Zacks Rank #2 (Buy). This implies the stock will outperform the broader U.S. equity market over one to three months.
Magellan Midstream anticipates fourth-quarter earnings of $0.92 per unit, higher than the year-ago figure of $0.88. Moreover, the partnership increased its 2014 distributable cash flow guidance by $25 million to $865 million. The suggested improvement reflects Magellan Midstream’s positive outlook on the back of excellent operating performance throughout 2014.
Last month, Magellan Midstream – owns an attractive portfolio of energy infrastructure assets that generate stable and recurring fee- and tariff-based revenues − entered into a deal with BridgeTex Pipeline Company, LLC to buy pipeline systems that spread over roughly 40 miles in the Houston Gulf Coast region. We believe that with the purchase, the partnership will likely become one of the premium midstream players in the Houston Gulf Coast region.
Moreover, lucrative acquisitions and organic growth projects have made major contributions toward Magellan Midstream’s development. Over the past one decade, the partnership has invested around $3 billion in various ventures and takeovers.
Additionally, the partnership continues to look out for more than $500 million of growth projects in the earlier stages of development.
Other Stocks That Warrant a Look
Apart from Magellan Midstream, one can also consider stocks in the energy space like SandRidge Mississippian Trust I (SDT), Sandridge Mississippian Trust II (SDR) and Murphy USA Inc. (MUSA). All these stocks sport a Zacks Rank #1 (Strong Buy).
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