Citigroup Reiterates NuStar GP Holdings Rating

Citigroup reports that NuStar GP Holdings, LLC Units

generates all its cash flows from its holdings in the underlying MLP, NuStar Energy

, including 2% GP interest, 10 million common units and 100% incentive distribution rights (IDRs) that generate leveraged upside to NSH if NS distributions are growing. “We reiterate our Buy/High Risk (1H) rating and are raising our target price for NSH by $9.00 based on a higher cash flow multiple of 23x,” Citigroup writes. “This is slightly below the latest GP transaction multiple of ~25x. Our bullish view reflects our confidence in NSH's growth potential that is supported by NS's expansion projects.” NuStar Energy closed Monday at $62.85; NuStar GP Holdings closed at $33.85.