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What Will Drive EnLink Midstream’s 4Q16 EBITDA

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EnLink Midstream’s 4Q16 EBITDA estimates

EnLink Midstream Partners (ENLK) and its general partner, EnLink Midstream LLC (ENLC), are scheduled to release their 4Q16 earnings on February 15, 2017. Crestwood Equity Partners (CEQP) is expected to report on February 21, 2017. In this series, we’ll talk about ENLK’s 4Q estimates, market performance, key performance indicators, and analyst recommendations.

Let’s start with the analysts’ earnings estimates.

Wall Street analysts’ 4Q16 consensus EBITDA (earnings before interest, taxes, depreciation, and amortization) estimate for ENLK is $197.7 million. ENLK’s 4Q16 estimate is 5.7% higher than the 4Q15 adjusted EBITDA and 1.5% less than the previous quarter adjusted EBITDA.

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4Q16 EBITDA drivers

EnLink Midstream’s 4Q16 YoY EBITDA growth is expected to be driven by the following factors:

  • strong throughput volumes from the Delaware and STACK regions
  • increase in processing capacity through expansion projects placed into service
  • higher NGLs (natural gas liquids) revenue driven by higher demand and a slight recovery in prices

The above positives might be slightly offset by a decline in partnership’s throughput volumes due to production related shut-ins in some regions and non-core asset sale.

Adjusted EBITDA versus consensus estimates

ENLK’s 3Q16 EBITDA estimate was $194.5 million, while the adjusted EBITDA was $200.8 million, representing a 3.3% beat. We still have to wait for the company’s 4Q16 earnings release to see whether ENLK has beaten or missed its 4Q16 earnings estimates. To be sure, we’ll cover this in our post-earnings series for ENLK once it reports its 4Q16 results.

Continue to the next part of this series for a closer look at ENLK’s segments.

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