Plains All-American Pipeline LP (PAA & PAGP) - Aug 10

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dan_s
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Joined: Fri Apr 23, 2010 8:22 am

Plains All-American Pipeline LP (PAA & PAGP) - Aug 10

Post by dan_s »

PAGP closed at $11.42 today. Dividends s/b $0.87 this year for yield of ~7.62%, but their DCF is heading to $2.19 per share this year and $2.40 per share in 2023.

They are focused on lowering debt with free cash flow now, but I think they will raise dividends quite a bit in 2023. They have enough DCF to double the dividend. Non-core asset sales are also reducing debt.

TipRanks: "In the last 3 months, 8 ranked analysts set 12-month price targets for PAA. The average price target among the analysts is $13.81. The 8 price targets range from $12 to $18."

I have updated my forecast/valuation for their strong Q2 results and increased guidance. My current valuation is $18.00, primarily because Plains will benefit from increased Permian Basin production for many years.
Dan Steffens
Energy Prospectus Group
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