UPDATE: J.P. Morgan Initiates Coverage on EV Energy Partners LP with Overweight Rating, $69 PT on Potential Utica Monetization

In a report published Wednesday, J.P. Morgan initiated coverage on EV Energy Partners LP

with an Overweight rating and $69.00 price target. J.P. Morgan noted, “EVEP intends to pursue the sale or monetization of a portion of the Utica position, 150,000 net working interest acres (including 20,000 net acres in a JV). EVEP plans to keep a 2% ORRI on ~ 880,000 gross acres intact following these transactions. We expect EVEP to monetize these assets in 1H2013. EVEP currently trades at a sizeable premium to peers (5.7% vs. 9.3% peer avg.) given the potential for a large distribution increase fueled by this asset swap. However, we note that the Utica swap could drive a distribution increase of 70% (or more), which would imply an EVEP yield of ~9.7%, a discount to peers (highlighting EVEP's attractive valuation).” EV Energy Partners LP closed on Tuesday at $54.04.