UPDATE: Bank of America Initiates Coverage on Plains GP Holdings LP with Neutral Rating, $24 PT as Leverage to PAA/US Crude Oil Growth Are Priced In

In a report published Monday, Bank of America analyst Gabe Moreen initiated coverage on

with a Neutral rating and $24.00 price target. In the report, Bank of America noted, “We initiate coverage of Plains GP Holdings, LP (PAGP) with a Neutral rating and $24 PO. PAGP is the general partner (GP) of Plains All American Pipeline, LP (PAA), a crude oil transportation, storage, and logistics MLP. PAGP's cash flows are derived from its interest in the incentive distribution rights (IDRs) at PAA. PAGP went public at $22 per unit (versus an IPO range of $22-25/unit). PAGP is structured as an MLP; however, unitholders will receive a 1099 (not a Schedule K-1) due to the election by PAGP to be taxed as a corporation. Management expects 100% of PAGP's distributions to be a tax-deferred return of capital (ROC) for at least 3 years.” Plains GP Holdings LP closed on Friday at $22.89.