Market Overview

UPDATE: Bank of America Initiates MPLX LP at Buy on Valuation, Risk Profile

Related MPLX
Marathon Petroleum Corporation and MPLX LP Present Long-Term Strategic Priorities at 2013 Analyst & Investor Day
Benzinga's Top Initiations

Bank of America initiated coverage on MPLX LP (NYSE: MPLX) with a Buy rating and a $32 price objective.

Bank of America commented, "MPLX trades at a discount to peers on an adjusted EV/EBITDA basis, which we see as unjustified given its potential to provide peer-leading distribution growth through drop-downs from its general partner (GP), MPC, and the low business risk profile of its asset base. Incorporating approximately $900mn in drop-downs through 2014, we forecast MPLX will grow distributions at a 25% CAGR through 2014E while maintaining DCF coverage of at least 1.1x. … We think MPLX's underlevered balance sheet and attractive cost of equity capital should help facilitate accretion from potential asset drop-downs. We also see MPLX's feebased contracts and minimum volume commitments (MVCs) from MPC as lowering its business risk profile."

MPLX LP closed at $27.05 on Monday.

Latest Ratings for MPLX

Oct 2017UBSMaintainsBuy
Oct 2017Stifel NicolausMaintainsBuy
Aug 2017JefferiesMaintainsBuy

View More Analyst Ratings for MPLX
View the Latest Analyst Ratings

Posted-In: Bank of AmericaAnalyst Color Initiation Pre-Market Outlook Analyst Ratings


Related Articles (MPLX)

View Comments and Join the Discussion!