UPDATE: Wunderlich Securities Reiterates On NGL Energy Partners LP On Organic Projects To Support Growth
In a report published Wednesday, Wunderlich Securities analyst Abhishek Sinha reiterated a Buy rating on NGL Energy Partners LP (NYSE: NGL), and raised the price target from $41.00 to $44.00.
In the report, Wunderlich Securities noted, “NGL Energy Partners (NGL) reported 4Q14 Adj. EBITDA of $116mm, beating our estimate of $106mm and the consensus of $105mm. Distributions increased 3.9% sequentially to $0.55/unit. The company reaffirmed its FY2015 EBITDA guidance of $425-430mm. However, it also raised the capex guidance from $300mm to $500mm as it intends to sharply focus on internal projects. NGL guided to a distribution growth of 15% and 10%+ for FY2015 and FY2016 mainly driven by organic activities.
"We are raising our price target from $41 to $44 as we get more confidence in its growth trajectory that is now backed by an even stronger coverage ratio of 1.4x. We also reduced our discount rate from 10% to 9.8% as we think organic projects would be more certain and less risky.”
NGL Energy Partners LP closed on Tuesday at $39.90.
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