Valero Energy Partners: Top Midstream MLP Gainer on October 8

Valero Energy Partners (VLP) was the top gainer among midstream MLPs at the end of trading on Thursday, October 8. It rose 4.6% yesterday.

With yesterday’s gain, Valero Energy Partners’ YTD (year-to-date) return improved to 17.4%. Valero Energy Partners’ solid YTD market performance can be attributed to its strong distribution growth and coverage ratio. Its 2Q15 distribution grew by 31.5% YoY (year-over-year) compared to 1Q14. Its coverage ratio for 2Q15 was 2.2x. Read Energy MLPs: How Did 6 Logistics Subsidiaries Perform in 2Q15? for a comparative analysis of six US logistics subsidiaries, including Valero Energy Partners.

Dominion Midstream Partners (DM) is next on our list of the top midstream MLP gainers. It rose 4.5% yesterday. Dominion Midstream Partners has returned -24.9% YTD. It was formed by Dominion Resources (D) to provide natural gas transportation, storage, and regasification services. Dominion Midstream started trading in October 2014. Since then, the stock has returned 11.6%.

The next three MLPs on the list of the top five midstream MLP gainers on October 8 are Midcoast Energy Partners (MEP), Rice Midstream Partners (RMP), and Transmontaigne Partners (TLP). They rose 4.5%, 4.1%, and 4.1%, respectively. These three MLPs have returned -14.5%, -14.2, and 2.8% YTD.

Rice Midstream Partners was formed by Rice Energy (RICE) to own, operate, acquire, and develop midstream assets in the Appalachian Basin. It mainly provides natural gas gathering and compression services. Rice Midstream Partners operates as a toll-road business with very limited commodity price exposure. For an in-depth overview of Rice Midstream Partners’ performance drivers, read Comparing 4 Midstream MLP Subsidiaries of Upstream C-Corps.

The Alerian MLP ETF (AMLP) and the Nuveen Energy MLP Total Return (JMF) rose 0.64% and 0.73% yesterday. For context, the upstream energy company heavy SPDR S&P Oil & Gas Exploration & Production ETF (XOP) rose 3.7% on the same day.