UPDATE: Credit Suisse Initiates Outperform, $26 PT on Inergy Midstream
Credit Suisse initiates its coverage on Inergy Midstream (NYSE: NRGM) with an Outperform rating and a price target of $26 a share on quality high storage and transportation growth assets. Credit Suisse says, “NRGM is executing on its plan to build an integrated storage and transportation hub via a $380mm expansion program. Furthermore, we believe that NRGM will be able to add transportation capacity at favorable economics through installation of more compression. Another growth lever that management is likely to pull will be drop-drown acquisitions from its sponsor, Inergy LP (NRGY). In our view, NRGM should be able to grow distributions at a 7.2% CAGR over the next three years through a combination of organic growth and dropdowns.” NRGM closed at $19.75 a share yesterday.
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