Market Overview

UPDATE: Stifel Downgrades Capital Product Partners on Valuation

Related CPLP
Mid-Morning Market Update: Markets Open Higher; Procter & Gamble Profit Tops Expectations
10 Stocks Moving In Tuesday's Pre-Market Session
MLPs Log Best April Ever (Seeking Alpha)

In a report published Friday, Stifel analyst Benjamin Nolan downgraded Capital Product Partners (NASDAQ: CPLP) to Hold from Buy on valuation.

According to the report, while analysts believe Capital Product Partners could benefit from increasing product tanker rates with 12 vessels on charter expiring in the next 18 months, it is likely to have a little impact on overall partnership cash flows due to the diverse fleet which also includes crude tankers, containerships and one dry bulk vessel.

“CPLP units currently trade at a distribution yield of 8.9%, which is the high end of the historical range,” the report noted. “In fact, since 2007 the units have consistently traded at greater than an 8% yield and on only a few occasions traded less than 9%. Given that our view is it would be challenging to materially increase distributions away from acquisitions which would have to be accompanied by the issuance of new dilutive equity, we believe an 8%-9% distribution yield is appropriate. Furthermore, based on the assets held at the general partner Capital Maritime, we believe material dropdowns are unlikely to transpire until newbuilding deliveries occur primarily in 2015.”

CPLP closed Thursday at $10.47.

Latest Ratings for CPLP

Mar 2016Standpoint ResearchMaintainsBuy
Mar 2016Wells FargoDowngradesOutperformMarket Perform
Mar 2016Seaport GlobalDowngradesAccumulateNeutral

View More Analyst Ratings for CPLP
View the Latest Analyst Ratings

Posted-In: Benjamin Nolan StifelAnalyst Color Downgrades Analyst Ratings


Related Articles (CPLP)

View Comments and Join the Discussion!