Scotiabank analyst Alonso Guerra-Garcia resumed coverage of Plains All American with an Outperform rating and $14 price target. Following a 50% distribution cut, the significantly improved free cash flow profile "bodes well for future de-leveraging and buybacks," said Guerra-Garcia, who also views concerns about its risk to exposure to federal lands as "overdone."
PAA is currently trading at $9.03. Quarterly distributions are $0.18 for annual yield of 7.97% < MLP
PAGP is currently trading at $9.10. Quarterly dividends are $0.18 for annual yield of 7.91% < C-Corp
I am updating my forecast/valuation model for PAA this morning and it will be posted to the EPG website by noon CT.
Plains All-American Pipeline LP (PAA & PAGP) Update - Feb 5
Plains All-American Pipeline LP (PAA & PAGP) Update - Feb 5
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Plains All-American Pipeline LP (PAA & PAGP) Update - Fe
HOUSTON - Plains All American Pipeline, L.P. (Nasdaq: PAA) and Plains GP Holdings (Nasdaq: PAGP) announced they will release fourth-quarter and full-year 2020 earnings after market close on Tuesday, February 9, 2021 and will hold a joint webcast on the same day as follows:
What: Fourth-quarter and Full-Year 2020 earnings webcast
When: Tuesday, February 9, 2021 5:30 p.m. ET; 4:30 p.m. CT
Where: www.plainsallamerican.com or https://event.webcasts.com/starthere.js ... f158236b02
How: Live over the internet - log on at either of the addresses above
Specific items we intend to address on the call include:
> PAA's fourth-quarter and full-year 2020 performance;
> Capitalization and liquidity; and Financial and operating guidance
The slide presentation accompanying the conference call materials will be posted prior to the call at www.plainsallamerican.com under the "Investor Relations" sections of the website (Navigate to: Investor Relations / either "PAA" or "PAGP" / News & Events / Quarterly Earnings).
An audio replay will be available on the website after the call. Additionally, a transcript will be included within the 4Q20 Earnings Package found within the "Investor Kit" section of the above referenced website.
PAA is a publicly traded master limited partnership that owns and operates midstream energy infrastructure and provides logistics services for crude oil, natural gas liquids ("NGL"), and natural gas. PAA owns an extensive network of pipeline transportation, terminalling, storage and gathering assets in key crude oil and NGL producing basins and transportation corridors and at major market hubs in the United States and Canada. On average, PAA handles more than 6 million barrels per day of crude oil and NGL in its Transportation segment. PAA is headquartered in Houston, Texas. More information is available at www.plainsallamerican.com.
PAGP is a publicly traded entity that owns an indirect, non-economic controlling general partner interest in PAA and an indirect limited partner interest in PAA, one of the largest energy infrastructure and logistics companies in North America. PAGP is headquartered in Houston, Texas. More information is available at www.plainsallamerican.com.
What: Fourth-quarter and Full-Year 2020 earnings webcast
When: Tuesday, February 9, 2021 5:30 p.m. ET; 4:30 p.m. CT
Where: www.plainsallamerican.com or https://event.webcasts.com/starthere.js ... f158236b02
How: Live over the internet - log on at either of the addresses above
Specific items we intend to address on the call include:
> PAA's fourth-quarter and full-year 2020 performance;
> Capitalization and liquidity; and Financial and operating guidance
The slide presentation accompanying the conference call materials will be posted prior to the call at www.plainsallamerican.com under the "Investor Relations" sections of the website (Navigate to: Investor Relations / either "PAA" or "PAGP" / News & Events / Quarterly Earnings).
An audio replay will be available on the website after the call. Additionally, a transcript will be included within the 4Q20 Earnings Package found within the "Investor Kit" section of the above referenced website.
PAA is a publicly traded master limited partnership that owns and operates midstream energy infrastructure and provides logistics services for crude oil, natural gas liquids ("NGL"), and natural gas. PAA owns an extensive network of pipeline transportation, terminalling, storage and gathering assets in key crude oil and NGL producing basins and transportation corridors and at major market hubs in the United States and Canada. On average, PAA handles more than 6 million barrels per day of crude oil and NGL in its Transportation segment. PAA is headquartered in Houston, Texas. More information is available at www.plainsallamerican.com.
PAGP is a publicly traded entity that owns an indirect, non-economic controlling general partner interest in PAA and an indirect limited partner interest in PAA, one of the largest energy infrastructure and logistics companies in North America. PAGP is headquartered in Houston, Texas. More information is available at www.plainsallamerican.com.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Plains All-American Pipeline LP (PAA & PAGP) Update - Fe
During PAA's most recent presentation they told the market that they expect to generate approximately $900 million of free cash flow after distributions; includes $600 million of cash proceeds from planned asset sales. My take is that half of their FCF will be used to pay down debt and the other half will be used to increase quarterly distributions or buy-back units in the open market. In fact, they said they plan to allocate 25% of FCF to a unit repurchase program in 2021.
Based on my forecast, actual FCF should exceed their estimate above in 2021, primarily because they are going to cut way back on capex spending this year.
An increase in their quarterly distributions back to pre-pandemic levels should send the unit price back to test the 52-week high of $16.56.
My valuation of PAA today is $13.70. PAGP's valuation is slightly higher just because it is a C-Corp.
Also, if PAA hits the EBITDA guidance for Q4 that they provided in November, the company is going to beat the current First Call earnings per unit estimate of $0.33 by a wide margin.
Based on my forecast, actual FCF should exceed their estimate above in 2021, primarily because they are going to cut way back on capex spending this year.
An increase in their quarterly distributions back to pre-pandemic levels should send the unit price back to test the 52-week high of $16.56.
My valuation of PAA today is $13.70. PAGP's valuation is slightly higher just because it is a C-Corp.
Also, if PAA hits the EBITDA guidance for Q4 that they provided in November, the company is going to beat the current First Call earnings per unit estimate of $0.33 by a wide margin.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Plains All-American Pipeline LP (PAA & PAGP) Update - Fe
Since January 1st four analysts have increased their price target for PAA
Scotiabank 2/1/2021 $14.00
Merrill Lynch 1/22/2021 $13.00
Mizuho Securities 1/20/2021 $14.00
Raymond James 1/14/2021 $12.00
If my Q4 forecast is accurate, their price targets will be going higher after next week.
Scotiabank 2/1/2021 $14.00
Merrill Lynch 1/22/2021 $13.00
Mizuho Securities 1/20/2021 $14.00
Raymond James 1/14/2021 $12.00
If my Q4 forecast is accurate, their price targets will be going higher after next week.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group