CSI Compressco

CSI Compressco (CCLP), a midstream MLP involved mainly in natural gas compression, was the biggest MLP gainer last week, which ended November 10, 2017. CCLP had a strong start to the week, but the gains were slightly offset by the falls after the 3Q17 earnings announcement. Overall, the partnership ended the week 16.3% higher. It reported $23.3 million in adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) for 3Q17, which represents a 3% year-over-year fall compared to the same quarter in the previous year.

However, the partnership remains optimistic about its growth prospects. According to Stuart M. Brightman, CCLP’s president, “We are seeing positive momentum from several areas, including demand for more compression equipment to address field gathering system requirements, gas lift opportunities, GasJack units to address late life wells, new orders for the fabrication and purchase of equipment by midstream companies and operators, and stronger demands for aftermarket parts and services.”

Top MLP Gainers for Week Ended November 10

NGL Energy Partners

NGL Energy Partners (NGL) was the second biggest MLP gainer last week. It ended the week 14.4% higher. NGL stock rose following the announcement that the MLP would sell a portion of its retail propane business for $200 million in cash. That was followed by an announcement to sell 50% of its interest in the Glass Mountain Pipeline “to an Affiliate of BlackRock Inc.’s Global Energy and Power Infrastructure Fund for $300 million,” as noted in a November 9, 2017, press release. The partnership expects to use the proceeds from this transaction to deleverage its balance sheet. Investors seem to be welcoming the move to improve its financial position.

Legacy Reserves

Legacy Reserves (LGCY), an upstream involved in crude oil, natural gas, and NGL (natural gas liquids) production, was the third biggest MLP gainer last week. LGCY’s gains last week could be mainly attributed to its better-than-expected 3Q17 earnings. It reported adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) of $58.8 million for the third quarter, which represents a 33% rise compared to the previous quarter. EBITDA growth was driven by a 25% rise in the partnership’s oil production. LGYC expects to end 2017 with adjusted EBITDA of $211.3 million–$214.3 million. It expects 2018 EBITDA to be $280 million–$330 million.

Other top MLP gainers

Sanchez Production Partners (SPP), Plains GP Holdings (PAGP), Dorchester Minerals (DMLP), Natural Resource Partners (NRP), Plains All American Pipeline (PAA), Alon USA Partners (ALDW), and Teekay LNG Partners (TGP) were among the top ten MLP gainers last week.

In the next part of the series, we’ll look at the technical indicators for Plains All American Pipeline.

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