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What Do Wall Street Analysts Say About ETP in 2015?

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Updated

Short-term targets

In the previous part of the series, we discussed the relative valuation of Energy Transfer Partners (ETP). In the final part of this series we’ll discuss what Wall Street analysts recommend for the stock.

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Most rate ETP as “buy”

About 57% of analysts rate Energy Transfer Partners as “buy,” and ~43% rate it as “hold.” There are no “sell” recommendations on ETP, which is a positive sign for the company.

Individual recommendations

Tudor Pickering & Co, which has given a buy recommendation for ETP, bets a target price of $115, which is the highest among the analyst group selected. If ETP were to achieve this level, its investors would get a return of ~109.7% over the next year from its current levels of $54.82.

Both RBC Capital Markets and Credit Suisse (CS) have rated ETP as “outperform” and given a target price of $72 and $77, respectively. If ETP reaches these levels, investors will get a handsome return of ~31.3% and ~40.4%, respectively.

Goldman Sachs (GS) has rated ETP as “neutral” and given a pessimistic estimate of $63. Considering the solid performance of ETP in the recent past, this target level seems achievable. At $63, ETP would generate a return of ~15% from its current level.

The median broker target price of $71 implies a ~29% return in the next 12 months.

Key ETFs

Investors can get exposure to ETP by buying individual common units or through ETFs like the Alerian MLP ETF (AMLP) and the First Trust North American Energy Infrastructure Fund (EMLP). ETP alone constitutes ~7.05% of AMLP.

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