Recent institutional activity in MPLX
Bank of America Merrill Lynch and Citi Investment Research were the biggest sellers in MLPX LP (MPLX) during the fourth quarter. They sold 4.0 million and 2.9 million shares of MPLX, which is currently the third largest MLP by market capitalization. MPLX is a diversified midstream MLP owned by Marathon Petroleum (MPC).
Morgan Stanley Investment Management and Cohen & Steers Capital Management added a major position in MPLX during the recent quarter. They bought 1.8 million and 1.5 million shares, respectively.
The number of institutional holders in MPLX increased to 348 by the end of the fourth quarter compared to 339 in the previous quarter. However, the percentage of shares held by institutional investors fell to 87.0% from 90.9% during the same timeframe. Among the top institutional holders, 2.2 million positions were sold, which might indicate a bearish sentiment in MPLX. Institutional investors’ bearishness toward MPLX could be due to its relatively high commodity price exposure and high counterparty exposure.
Top five holders
Tortoise Capital Advisors, Alps Advisors, Morgan Stanley Investment Management, Harvest Fund Advisors, and OFI SteelPath are among the top five institutional holders in MPLX. Tortoise Capital Advisors became the top institutional holder in the partnership, surpassing Alps Advisors with an addition of 1.5 million positions during the fourth quarter. It currently holds 8.2% in MPLX.
78.9% of analysts rate MPLX a “buy” as of February 23, and the remaining 21.1% rate it as a “hold.” Peers Energy Transfer Partners (ETP) and Targa Resources (TRGP) have “buy” ratings from 75.0% and 61.9% of analysts surveyed by Reuters. MPLX is currently trading below $38.0, the low range of analyst target prices. Its average target price of $41.9 implies ~21% upside potential from the current price levels.
In the next article, we’ll look into the recent institutional activity in Energy Transfer Partners (ETP).