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Plains All American (PAA)
NASDAQ:PAA
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Plains All American (PAA) AI Stock Analysis

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PAA

Plains All American

(NASDAQ:PAA)

Rating:68Neutral
Price Target:
$19.00
â–²(10.34% Upside)
Plains All American's overall stock score reflects a stable financial position with strengths in cash flow and strategic corporate actions. The attractive dividend yield and reasonable valuation support the score, while technical indicators suggest caution in the short term. The company's strategic focus on crude oil operations and recent acquisitions are positive for long-term growth, despite current revenue growth challenges.
Positive Factors
Infrastructure Investment
PAA acquired 55% of the EPIC Crude pipeline, which implies a significant investment in a key infrastructure asset.
Operational Performance
Adjusted EBITDA is slightly above consensus estimates, suggesting strong operational performance.
Negative Factors
Cash Management
Free Cash Flow after dividend shows a large negative variance compared to estimates, raising concerns about cash management.

Plains All American (PAA) vs. SPDR S&P 500 ETF (SPY)

Plains All American Business Overview & Revenue Model

Company DescriptionPlains All American Pipeline, L.P., through its subsidiaries, engages in the pipeline transportation, terminalling, storage, and gathering of crude oil and natural gas liquids (NGL) in the United States and Canada. The company operates in two segments, Crude Oil and NGL. The Crude Oil segment offers gathering and transporting crude oil through pipelines, gathering systems, trucks, and at times on barges or railcars. This segment provides terminalling, storage, and other facilities-related services, as well as merchant activities. As of December 31, 2021, this segment owned and leased 18,300 miles of active crude oil transportation pipelines and gathering systems, as well as an additional 110 miles of pipelines that supports crude oil storage and terminalling facilities; 74 million barrels of commercial crude oil storage capacity; 38 million barrels of active, above-ground tank capacity; four marine facilities; a condensate processing facility; seven crude oil rail terminals and 2,100 crude oil railcars; and 640 trucks and 1,275 trailers. The Natural Gas Liquids segment engages in the natural gas processing, NGL fractionation, storage, transportation, and terminalling activities. As of December 31, 2021, this segment owned and operated four natural gas processing plants; nine fractionation plants; 28 million barrels of NGL storage capacity; approximately 1,620 miles of active NGL transportation pipelines, as well as an additional 55 miles of pipeline that supports NGL storage facilities; 16 NGL rail terminals and approximately 3,900 NGL rail cars; and approximately 220 trailers. The company was founded in 1981 and is headquartered in Houston, Texas. Plains All American Pipeline, L.P. operates as a subsidiary of Plains GP Holdings, L.P.
How the Company Makes MoneyPlains All American generates revenue primarily through its transportation and storage services for crude oil and natural gas liquids. The company charges fees for the transportation of these hydrocarbons through its extensive pipeline network, which is a major revenue stream. Additionally, PAA earns income from its storage facilities, where it charges customers for storing their products. The company also engages in marketing activities, buying and selling crude oil and natural gas liquids, which contributes to its earnings. Significant partnerships with major oil producers and refiners enhance its operational efficiency and revenue potential, while market dynamics such as demand for energy products and regulatory factors can also impact its financial performance.

Plains All American Earnings Call Summary

Earnings Call Date:Aug 08, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 30, 2025
Earnings Call Sentiment Neutral
The earnings call presented a balanced view with significant achievements like the solid adjusted EBITDA and strategic divestiture of the NGL business, alongside challenges including lower-than-expected NGL segment performance and increased capital expenditures. The overall sentiment of the call reflects a cautious but optimistic outlook, with strategic moves aimed at long-term growth and financial flexibility.
Q2-2025 Updates
Positive Updates
Solid Second Quarter Adjusted EBITDA
Plains reported solid second quarter adjusted EBITDA attributable to Plains of $672 million.
Sale of NGL Business to Keyera
Plains announced the sale of its NGL business to Keyera for approximately $3.75 billion, with a positive initial investor feedback and an expected close in the first quarter of 2026.
Bolt-On Acquisition of BridgeTex Pipeline Interest
Plains acquired an additional 20% interest in BridgeTex Pipeline Company LLC for $100 million, bringing its overall interest to 40%.
Permian Volume Growth
Crude oil segment adjusted EBITDA was $580 million, benefiting from Permian volume growth and contributions from recent acquisitions.
Commitment to Financial Flexibility
Plains plans to use proceeds from the NGL sale to focus on disciplined bolt-on M&A and optimize capital structure, including potential unit repurchases.
Negative Updates
NGL Segment Performance
Adjusted EBITDA for the NGL segment was $87 million, stepping down sequentially due to normal seasonality and lower frac spreads.
Expected Lower Half of 2025 EBITDA Range
Guidance indicates that both the full-year EBITDA and Permian growth outlook are likely to be in the lower half of their respective ranges.
Contract Roll-Offs Impacting Second Half
Contract roll-offs for Cactus I, Cactus II, and Sunrise are expected to impact the second half performance, despite recontracting efforts.
Increased 2025 Growth Capital Guidance
Growth capital guidance for 2025 increased by $75 million to $475 million due to new projects, delays, and scope changes.
Company Guidance
During the Plains All American (PAA) and Plains GP Holdings (PAGP) second quarter 2025 earnings call, the company reported an adjusted EBITDA of $672 million. They detailed a significant transaction involving the sale of nearly all their NGL business to Keyera for approximately $3.75 billion, expected to close in the first quarter of 2026. This move is set to streamline PAA into a crude oil-focused midstream entity, with anticipated net proceeds of $3 billion to be used for strategic acquisitions and capital optimizations. The company also announced a $100 million acquisition to increase their interest in BridgeTex Pipeline Company LLC to 40%. Year-to-date, PAA has completed five bolt-on transactions totaling around $800 million, and despite some adjustments, they maintained their full-year EBITDA guidance between $2.8 billion to $2.95 billion. Their capital allocation strategy for 2025 includes generating approximately $870 million in adjusted free cash flow, with growth capital guidance revised to $475 million.

Plains All American Financial Statement Overview

Summary
Plains All American demonstrates a balanced financial position with strengths in profitability and cash flow generation. The income statement shows stable margins, though revenue growth is a concern. The balance sheet is strong, with a healthy debt-to-equity ratio and solid equity base. Cash flow metrics indicate efficient cash management. Overall, the company is financially stable but should address revenue growth challenges to enhance future performance.
Income Statement
65
Positive
Plains All American shows a mixed performance in its income statement. The TTM data indicates a decline in revenue growth at -4.67%, which is concerning. However, the company maintains a stable gross profit margin of 28.51% and a net profit margin of 1.92%. The EBIT and EBITDA margins are moderate at 3.77% and 5.89%, respectively. While profitability is present, the declining revenue trend poses a risk.
Balance Sheet
72
Positive
The balance sheet reflects a solid financial structure with a debt-to-equity ratio of 0.50, indicating manageable leverage. The return on equity is 7.24%, showing decent profitability for shareholders. The equity ratio stands at 64.91%, suggesting a strong equity base relative to total assets. Overall, the balance sheet is stable with a good balance between debt and equity.
Cash Flow
68
Positive
Cash flow analysis reveals a positive trajectory with a free cash flow growth rate of 3.40% in the TTM period. The operating cash flow to net income ratio is 0.52, and the free cash flow to net income ratio is 0.87, indicating efficient cash generation relative to net income. Despite some fluctuations, cash flow remains robust, supporting the company's operations and potential investments.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue47.80B50.07B48.71B57.34B42.04B23.29B
Gross Profit13.63B1.72B2.76B1.89B1.74B1.43B
EBITDA2.82B2.74B3.06B2.53B2.23B-1.51B
Net Income916.00M772.00M1.23B1.04B593.00M-2.58B
Balance Sheet
Total Assets27.16B26.56B27.36B27.89B28.61B24.50B
Cash, Cash Equivalents and Short-Term Investments459.00M348.00M450.00M401.00M449.00M22.00M
Total Debt8.87B7.93B8.03B8.82B9.64B10.61B
Total Liabilities14.21B13.47B13.62B14.57B15.80B14.76B
Stockholders Equity9.71B9.81B10.42B10.06B9.97B9.59B
Cash Flow
Free Cash Flow2.13B1.87B2.17B1.95B1.66B776.00M
Operating Cash Flow2.45B2.49B2.73B2.41B2.00B1.51B
Investing Cash Flow-2.48B-1.50B-702.00M-526.00M386.00M-1.09B
Financing Cash Flow-375.00M-1.08B-1.98B-1.93B-1.98B-435.00M

Plains All American Technical Analysis

Technical Analysis Sentiment
Negative
Last Price17.22
Price Trends
50DMA
17.92
Negative
100DMA
17.42
Negative
200DMA
17.70
Negative
Market Momentum
MACD
-0.14
Positive
RSI
36.37
Neutral
STOCH
21.18
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PAA, the sentiment is Negative. The current price of 17.22 is below the 20-day moving average (MA) of 17.57, below the 50-day MA of 17.92, and below the 200-day MA of 17.70, indicating a bearish trend. The MACD of -0.14 indicates Positive momentum. The RSI at 36.37 is Neutral, neither overbought nor oversold. The STOCH value of 21.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PAA.

Plains All American Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
$8.56B15.1352.91%7.07%9.02%17.28%
77
Outperform
$14.51B11.7138.42%9.41%7.11%-16.14%
74
Outperform
$12.18B10.7816.43%6.30%17.92%18.39%
69
Neutral
$10.69B28.308.48%2.95%15.28%-9.99%
68
Neutral
$12.11B19.048.34%8.46%-4.31%-17.80%
65
Neutral
$15.01B7.483.39%5.36%4.10%-61.80%
62
Neutral
$13.99B26.808.16%7.91%-4.31%-16.62%
* Energy Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
PAA
Plains All American
17.16
1.24
7.79%
WES
Western Midstream Partners
37.94
3.62
10.55%
PAGP
Plains GP Holdings
18.42
1.22
7.09%
VNOM
Viper Energy
37.45
-6.95
-15.65%
HESM
Hess Midstream Partners
40.05
7.13
21.66%
DTM
DT Midstream
104.53
32.29
44.70%

Plains All American Corporate Events

Private Placements and Financing
Plains All American Completes $1.25 Billion Debt Offering
Neutral
Sep 8, 2025

On September 8, 2025, Plains All American Pipeline, L.P. and PAA Finance Corp. completed a public offering of $1.25 billion in debt securities, which includes $700 million in 4.700% Senior Notes due 2031 and $550 million in 5.600% Senior Notes due 2036. These senior unsecured notes are designed to rank equally with existing senior debt and are subject to certain covenants and default events, potentially impacting the company’s financial flexibility and stakeholder interests.

M&A TransactionsBusiness Operations and Strategy
Plains All American Acquires Stake in EPIC Crude Holdings
Positive
Sep 2, 2025

On August 30, 2025, Plains All American Pipeline, L.P. announced that a subsidiary has entered into a definitive agreement to acquire a 55% non-operated interest in EPIC Crude Holdings, LP from Diamondback Energy, Inc. and Kinetik Holdings Inc. for approximately $1.57 billion, including $600 million of debt. The acquisition, expected to close in early 2026, aims to enhance Plains’ wellhead to water strategy by providing additional upstream and downstream connectivity, and is anticipated to be immediately accretive to distributable cash flow. This strategic move strengthens Plains’ position as a leading crude oil midstream provider, offering enhanced market access and customer flexibility, while maintaining a strong balance sheet and creating further return of capital opportunities for stakeholders.

Executive/Board ChangesBusiness Operations and Strategy
Plains All American Extends CEO Grant Expiration
Neutral
Aug 18, 2025

On August 14, 2025, Plains All American‘s Board approved an extension of the expiration date for CEO Willie Chiang’s 2018 Promotional Grant to October 2030, aiming to incentivize his continued leadership and strategic initiatives. Additionally, special retention grants were awarded to key executives Jeremy Goebel and Chris Chandler to ensure their commitment to the company’s long-term goals, with vesting schedules extending beyond 2026.

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Plains All American Reports Strong Q2 2025 Results
Positive
Aug 8, 2025

On August 8, 2025, Plains All American Pipeline reported solid financial results for the second quarter of 2025, with a net income of $210 million and adjusted EBITDA of $672 million. The company announced the divestiture of its Canadian NGL business, expected to close in the first quarter of 2026, which will enhance financial flexibility and streamline operations. Additionally, Plains acquired an additional 20% interest in the BridgeTex Pipeline, strengthening its position in the Permian Basin. These strategic moves are aimed at optimizing the company’s asset base and returning cash to unitholders.

M&A TransactionsBusiness Operations and Strategy
Plains All American Sells Canadian NGL Business
Positive
Jun 17, 2025

On June 17, 2025, Plains All American Pipeline, L.P. announced a definitive agreement to sell its Canadian NGL business to Keyera Corp. for approximately C$5.15 billion. The transaction, expected to close in the first quarter of 2026, will allow Plains to focus on its crude oil operations in North America, enhancing its financial flexibility and free cash flow profile. The sale is anticipated to result in significant tax implications for PAA unitholders, with a special distribution planned to offset potential tax liabilities. The deal positions Plains as a premier pure play crude oil midstream entity, reducing its commodity exposure and working capital requirements.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Sep 04, 2025