Plains All-American Pipeline LP (PAA & PAGP) Update - May 30

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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) Update - May 30

Post by dan_s »

PAA and PAGP are going to raise dividends in 2023 and probably for many years to come.
This midstream company is a "Growth + Income" core holding for me.

Note below is from Keith Kohl at the "Energy Investor" 5-30-2023


Plains recently published its Q1 2023 results.
> The partnership reported a net income of $422 million during the quarter,
representing a significant jump of 126% over the first quarter of 2022. This substantial
growth was mirrored in the net cash provided by operating activities, which reached
$743 million, showing an impressive rise of 119% year over year.

> The company also delivered strong adjusted EBITDA of $715 million, with free cash
flow coming in at $823 million (approximately $284 million of this came from asset
sales). Plains has made strides in reducing its total debt by approximately $450 million.
Looking forward, Plains has reaffirmed its 2023 full-year guidance and projected its
adjusted EBITDA to range between $2.45 billion and $2.55 billion.

> CEO Willie Chiang expressed confidence in the company’s strong start to the year,
despite prevailing macro uncertainties, and emphasized the company’s focus on
execution, as well as its ability to deliver in 2023.

Of course, the cherry on top for us is the solid 23% increase made to Plains’ annualized
dividend.
Plains All American Pipeline L.P. (NASDAQ: PAA) is rated a “Buy” under $20
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At the time of this post PAA was trading at $13.36 and PAGP at $13.99.
> PAA is an MLP
> PAGP is a C-Corp that pays identical quarterly dividends as PAA does.
> Thanks to a lot of high capex projects in the rearview mirror, PAA is now generating a lot more DCF, so cash distributions will be going up.
> Current annualized yield over 7.5% and share price has ~50% upside.
Dan Steffens
Energy Prospectus Group
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