Enterprise Products Partners (EPD) has received a new Hold rating, initiated by TD Cowen analyst, Jason Gabelman.
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Jason Gabelman has given his Hold rating due to a combination of factors impacting Enterprise Products Partners. The company is emerging from a significant capital expenditure phase focused on the Permian NGL value chain, which may lead to underutilization of some assets as they come online. This is because the industry is expected to have adequate NGL infrastructure, considering the projects undertaken by competitors.
Additionally, the positive trends in the Refined Product segment that have benefited the company in recent years are beginning to stabilize. With over half of its EBITDA tied to NGLs, the company’s growth prospects may be constrained by the well-established infrastructure for NGLs from the Permian. Furthermore, the new NGL assets, although expected to generate substantial earnings, might take time to reach full capacity, and the company’s projected growth capital expenditure is lower than in previous years.
According to TipRanks, Gabelman is a 4-star analyst with an average return of 8.8% and a 59.68% success rate. Gabelman covers the Energy sector, focusing on stocks such as BP, Calumet Specialty Products, and Cheniere Energy.