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Which Midstream Stocks Are Expected to Rise More than 20%?

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Jun. 6 2019, Updated 7:41 a.m. ET

Stocks with high upside

Previously, we discussed midstream stocks that analysts expect to rise more than 30%. The stocks include Energy Transfer (ET), Antero Midstream (AM), Noble Midstream Partners (NBLX), and Enable Midstream Partners (ENBL). Now, we’ll discuss the midstream stocks offering more than 20% upside, according to analysts. Stocks with a market capitalization of less than $1 billion aren’t included. The first stock is Enterprise Products Partners (EPD). With a mean target price of $34, Enterprise Products Partners offers an upside potential of 21% from its current price.

As the above graph shows, 100% of the analysts surveyed by Reuters rated Enterprise Products Partners as a “buy.”

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The second stock with high upside potential is MPLX (MPLX). MPLX offers an upside potential of ~26% based on its mean target price. Among the surveyed analysts, 92% of them rated MPLX as a “buy.” In comparison, based on a mean target price of $28, Plains All American Pipeline (PAA) offers a potential upside of ~23% from its current price. Targa Resources (TRGP) offers a potential upside of 27% based on its mean target price of $49.8. Targa Resources has been rated as a “buy” by 73% of the surveyed analysts.

Western Midstream Partners (WES) and EnLink Midstream (ENLC) fell 4.7% and 5.1%, respectively, on June 5. The two stocks are trading more than 30% below their respective mean target prices. The above graph shows midstream stocks that analysts expect to rise more than 20% from their current levels.

Although midstream stocks largely outperformed broader markets in the first quarter, volatile oil prices impacted the sector. Some of the stocks with high upside potential have been trading at high yields for quite some time. Smaller MLPs with higher leverage and a complex structure might remain more volatile due to uncertainties in broader markets.

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