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What Do Analysts Recommend for Buckeye Partners?

Key Highlights from Buckeye Partners' 1Q16 Earnings Release

(Continued from Prior Part)

Buckeye Partners’ 1Q16 distribution

In this part, we’ll look at analysts’ ratings for Buckeye Partners (BPL) following its 1Q16 earnings results. Before that, let’s look at the partnership’s 1Q16 distribution and Market performance.

Buckeye Partners declared a distribution of $1.20 per unit for 1Q16. This represents a 4.3% YoY increase over 1Q15 and a 1.1% sequential increase over 4Q15. The partnership expects to grow its distribution at a fixed rate of $0.01 per unit for each quarter in 2016. Based on recent distribution, the partnership is currently trading at a distribution yield of 7.0%. Buckeye Partners forms 0.51% of the First Trust North American Energy Infrastructure Fund (EMLP).

Buckeye Partners’ market performance

Buckeye Partners has returned 4.4% since the beginning of 2016. Its peers such as VTTI Energy Partners (VTTI), NuStar Energy (NS), and Holly Energy Partners (HEP) have returned -8.6%, 13.7%, and 5.2%, respectively, in 2016. At the same time, the Alerian MLP ETF (AMLP) has lost 1.2%. Buckeye Partners’ outperformance relative to AMLP most likely reflects its low commodity price exposure.

Analysts’ ratings for Buckeye Partners

At a broader level, 54.5% of analysts rate Buckeye Partners a “hold” and the remaining 45.5% rate it a “buy.” The consensus target price of $73.3 for Buckeye Partners implies a 6.4% price return in the next 12 months from its May 9 closing price of $68.9. The most recent ratings by Morgan Stanley and RBC Capital Markets rate Buckeye Partners as “overweight/in-line” and “sector perform.” These ratings are equivalent to “buy” and “hold,” respectively. They have assigned a target price of $76 and $68.

For more post-earnings coverage on midstream companies, visit Market Realist’s Master Limited Partnerships page.

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