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UPDATE: Credit Suisse Upgrades Suburban Propane Partners LP On Valuation

Dwight Einhorn

In a report published Friday, Credit Suisse analyst John Edwards upgraded the rating on Suburban Propane Partners LP (NYSE: SPH) from Underperform to Neutral, but lowered the price target from $46.00 to $45.00.

In the report, Credit Suisse noted, “SPH reported adjusted EBITDA $206mm, vs. Street's $191mm and our est. of $197mm. DCF of $182mm, beat our est. of $172mm. Upside was driven by higher margins and lower maintenance cap ex. Distribution of $0.875/unit was 2% and 3% below the Street and our estimate (and flat for the 5th straight Q). We are lowering our TP by $1 to $45 to account for lower distribution declared in the quarter. Our TP implies a total return of ~12% based on 8% yield, which is in-line with the median returns for our MLP coverage universe supportive of our Neutral rating.”

Suburban Propane Partners LP closed on Thursday at $43.40.

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