Enterprise Products Partners (EPD), which remains a core holding in an MLP (master limited partnership) portfolio, focuses on projects that generate stable cash flow and contribute to its integrated value chain. We believe the Haynesville Acadian Expansion and Eagle Ford projects will allow Enterprise to take a lead role in the development of natural gas liquids and natural gas infrastructure.
While Enterprise increased its cash flow distribution by 5.1% in the fourth quarter, it also deployed cash in various fee-based development projects that will likely generate operating cash flow to support its future distribution growth. As such, we believe Enterprise is well positioned going forward and view it as an attractive investment.
Thus we maintain our recommendation on Enterprise Products Partners at Outperform. Our $63 target price, 26.0x 2012 earnings per unit, corroborates this view.
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