Enterprise Products Partners, the Energy sector company, was revisited by a Wall Street analyst today. Analyst Jason Gabelman from TD Cowen maintained a Hold rating on the stock and has a $33.00 price target.
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Jason Gabelman has given his Hold rating due to a combination of factors impacting Enterprise Products Partners. The company recently missed earnings expectations, largely due to the expiration of an LPG contract and increased competition in the LPG export market. Despite these challenges, EPD is committed to defending its market position and plans to increase shareholder distributions as capital expenditures decrease in the coming years.
EPD’s strategy involves shifting from growth-focused investments to enhancing shareholder returns, which could potentially compress its EBITDA multiple given the sector’s recent re-rating towards higher growth backlogs. The company generates a significant portion of its EBITDA from the NGL value chain, which will require less infrastructure investment moving forward. Additionally, EPD’s LPG export facilities are largely contracted through 2030, providing some stability, though the competitive market environment remains a concern.
Gabelman covers the Energy sector, focusing on stocks such as Equinor ASA, NextDecade, and Enterprise Products Partners. According to TipRanks, Gabelman has an average return of 8.3% and a 56.99% success rate on recommended stocks.
In another report released yesterday, Goldman Sachs also maintained a Hold rating on the stock with a $33.00 price target.