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MLPs’ Rating Updates during the Week Ending November 3

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Dominion Energy Midstream Partners

Dominion Energy Midstream Partners (DM), the midstream MLP subsidiary of Dominion Energy (D), was downgraded last week by Mizuho and RBC Capital Markets. The partnership was downgraded by both of the research firms to a “hold” from a “buy.” Dominion Energy Midstream Partners is among the MLPs that experienced the most rating updates in 2017. It saw six rating updates in the past four months including four downgrades, one upgrade, and one new coverage with a “buy” rating. Now, 53.8% of the analysts surveyed by Reuters rate Dominion Energy Midstream Partners as a “buy,” 38.5% rate it as a “hold,” and 7.7% rate it as a “sell.” Its average target price of $34.2 implies ~8% upside potential from the current price levels.

Southcross Energy Partners

Southcross Energy Partners (SXE) was upgraded by Raymond James to “market perform,” which is equivalent to “hold,” from “underperform” following the announcement of the merger with American Midstream Partners (AMID). Currently, Southcross Energy Partners only has two analysts covering the stock. Both of the analysts rate it as a “hold.”

Holly Energy Partners

Holly Energy Partners (HEP), the midstream MLP formed by HollyFrontier (HFC) to provide crude oil and refined products transportation and terminaling services, was downgraded by UBS. UBS cut Holly Energy Partners to “neutral,” which is equivalent to “hold,” from “buy.” Overall, Holly Energy Partners has seen three rating updates in 2017 to date including two downgrades and one upgrade.

Now, 100% of the analysts rate Holly Energy Partners as a “hold.” Its average target price of $34.8 implies ~2% upside potential from the current price levels.

Green Plains Partners

Green Plains Partners (GPP), the midstream MLP involved mainly in ethanol transportation storage and terminaling, was downgraded last week by Stifel to “hold” from “buy.” At the same time, the partnership’s parent company, Green Plains (GPRE), was upgraded by PiperJaffray to “overweight” from “neutral.” Currently, Green Plains Partners is trading below the low range ($21) of analysts’ target prices. The partnership’s average target price of $23 implies 15% upside potential from the current price levels.

For more coverage on midstream companies, visit Market Realist’s Master Limited Partnerships page.

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