UPDATE: Wunderlich Initiates Coverage on DCP Midstream Partners at Hold, Establishes $53.00 PT

In a report published Friday, Wunderlich Securities analyst Abhishek Sinha initiated coverage on DCP Midstream Partners, LP (NYSE: DPM) with a Hold rating, establishing a $53.00 price target. According to the report, the oil and gas midstream MLP has stable cash flows supported by a combination of fee-based services and hedge contracts.“DPM also has favorable growth projects and a deep inventory of assets for potential drop-downs provided by the sponsor DCP Midstream,” the report noted. “However, considering its mediocre distribution growth, moderate leverage, high IDR splits, and relative valuation, we believe a Hold rating is appropriate at this time. Our $53 valuation and 12-month distribution forecast implies a total return potential of ~14% and results in a 6.3% target yield.”Some key points in the report included: -Fee-based earnings supported by hedges provide stable cash flows -DPM is supported by a strong sponsor, DCP Midstream -Solid line-up of growth projects in 2014 provides clear visibilityDPM closed Thursday at $49.33.