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Should You Include Buckeye Partners in Your Portfolio?

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Positive outlook

Buckeye Partners’ (BPL) outlook looks positive from a long-term investment standpoint, considering the following positives:

  • stable fee-based cash flow with limited exposure to fluctuations in crude oil prices
  • completion of organic and inorganic projects is expected to drive distributable cash flows
  • positive distribution guidance
  • Buckeye Partners’—see Part 6 and 7 for Buckeye Partners’ involvement in Buckeye Texas Partners—assets are fully supported by a seven to ten-year minimum volume commitment and storage contracts

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Most analysts rate Buckeye Partners as “hold”

Let’s check out whether our outlook on Buckeye Partners resonates with Wall Street analysts’ recommendations. At a broader level, ~54% of analysts rate Buckeye Partners as “hold” and ~46% rate it as “buy.” There aren’t any “sell” recommendations on Buckeye Partners. This is a positive sign for the company. The median broker target price of $83.50 implies an ~5.5% price return in the next 12 months.

Here are some analysts’ recent ratings:

  • Stifel, UBS (UBS), and Clarkson Capital Markets rate Buckeye Partners as “buy” with target prices of $89, $87, and $80, respectively.
  • Morgan Stanley (MS) and Barclays (BCS) rated Buckeye Partners as “equal weight” or “attractive” with target prices of $86 and $83, respectively.
  • Goldman Sachs (GS) is “neutral” with a pessimistic target price of $79.
  • US Capital Advisors rates Buckeye Partners as “hold” with a target price of $79.

Key ETFs and stocks

Investors add Buckeye Partners to their portfolio through buying its common units listed on a stock exchange or through ETFs like the Alerian MLP ETF (AMLP). Buckeye Partners accounts for ~4.9% of AMLP.

For other series on MLPs (master limited partnerships), you can refer to our Master Limited Partnerships page. We’ll continue to cover more company overviews and investment analysis series.

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