Plains All American Pipeline
This is another top MLP pick across Wall Street. Plains All American Pipeline L.P. (NYSE: PAA) is primarily engaged in midstream crude oil activities, including transportation, gathering, marketing and terminaling.
Top analysts feel the company deserves a premium valuation given its leverage to the Permian and attractive organic growth backlog. The company owns an extensive network of pipeline transportation, terminaling, storage and gathering assets in key crude oil and NGLs producing basins and transportation corridors and at major market hubs in the United States and Canada. On average, Plains All American handles more than 6 million barrels per day of crude oil and NGLs in its Transportation segment.
Investors in Plains All American Pipeline stock receive a 7.89% distribution. BofA Securities has set a $13 price objective. The posted consensus target price is $11.63, and shares have traded mostly above $9 in the past month.
This stock has traded sideways all year long and could be ready to run. Southwestern Energy Co. (NYSE: SWN) is one of the largest U.S. natural gas producers. Its primary producing locations are in the Fayetteville region and the Marcellus Shale. The company has acquired acreage in southwest Appalachia, is exceeding expectations and provides a runway to growth.
The company’s estimated proved natural gas, oil and NGLs reserves comprise 12,721 billion cubic feet of natural gas equivalent (Bcfe) and 929 Bcfe of proved undeveloped reserves. It also engages in marketing of natural gas, oil and NGLs. Southwestern Energy serves energy companies, utilities and industrial purchasers of natural gas.
Johnson Rice recently started coverage with a $6.75 price target. The $4.85 consensus target is much closer to the $4 or so where Southwestern Energy stock traded recently.
With WTI pushing the $60 level, many on Wall Street are pounding the table on the sector as a go-to trade and place to be for 2021. These five stocks offer aggressive investors a way to play the sector plus get some solid share count leverage.