UPDATE: JP Morgan Initiates SunCoke Energy Partners at Neutral; Near-Term Catalysts Lacking

JP Morgan initiated coverage on SunCoke Energy Partners

with a Neutral rating and a $21.00 price target. JP Morgan said, "Specializing in technologically advanced ovens, SXCP, we believe, has a strong cokemaking position with a strategic sponsor and a relatively young set of assets compared with old-age batteries that dominate the industry. SXCP's long-term, take-or-pay contracts with commodity price pass-through provisions seek to transform a cyclical business into a stable one with visible cash flows amenable to the MLP structure. Moreover, we expect SXC to drop down the remaining domestic cokemaking assets (with similar contracts), creating the potential for above-average distribution growth. However, we do not see a near-term catalyst and believe that MLP investors will need to see a few quarters of execution before gaining comfort in the name." SunCoke Energy Partners closed at $20.55 on Monday.