What Do Analysts Expect from Large-Cap Midstream Companies?

Spectra Energy Partners (SEP) and Energy Transfer Equity (ETE) both managed to trade 0.7% above their 100-day moving averages as of February 16, 2016. Other midstream players are trading below their 100-day moving averages.

The large-cap midstream companies in the following table were trading 25% below their respective 100-day moving averages. Upstream and downstream companies were trading 21% and 24.4% below their respective 100-day moving averages. Now, US-based (SPY) midstream companies are trading 2.6% above their 20-day moving averages. As of January 29, these midstream companies are trading 1.6% above their 20-day moving averages.

Midstream companies rose by an average of 6.9%—compared to a 0.4% rise in large-cap upstream companies and a 0.11% rise in downstream companies.

Kinder Morgan (KMI) and Williams Companies (WMB) were trading 27% and 50%, respectively, below their 100-day moving averages as of February 16. As of January 15, Kinder Morgan and Williams Companies were trading 47% and 55%, respectively, below their 100-day moving averages.

The Alerian MLP ETF (AMLP) was flat. Currently, it’s trading 22.6% below its 100-day moving average.

Wall Street analysts’ consensus estimates suggest an impressive 69% upside for these midstream companies—compared to 44% upside consensus estimates for large-cap upstream companies. Over the next 12 months, midstream operators Williams Companies and Energy Transfer Partners (ETP) could see rises of 121% and 44%, respectively, from their levels as of February 12. Below is a rundown of three other midstream operators and Wall Street analysts’ estimates for each company over the next 12 months.

• Kinder Morgan could see a 29% rise.
• Spectra Energy (SE) could see a 16% rise.
• Plains All American Pipeline (PAA) could see a 41% rise.

In the next part of this series, we’ll discuss the moving averages and analysts’ estimates for integrated oil and gas companies.