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Magellan Midstream Hikes Q4 Distribution

Zacks Equity Research

Pipeline operator Magellan Midstream Partners LP (MMP) has declared fourth-quarter 2013 cash distribution of 58.5 cents per unit ($2.34 per unit annualized). The new distribution reflects a sequential hike of 5.0% and a year-over-year increase of 17.0%. The increased distribution is payable on Feb 14, 2014 to unitholders of record as of Feb 7, 2014.

Notably, the latest payout increase of Magellan Midstream marks the 47th distribution hike following its initial public offering (IPO) in 2001. Since then, its cash distribution has increased 346.0%. We believe that the hike in cash distribution reflects continued strong performance by the partnership, backed by solid operating results, favorable investments and a diligent execution of strategic plans.

Magellan Midstream’s distribution for full-year 2013 stood at $2.18 per unit, reflecting a hike of 16.0% compared with $1.88 reported in 2012.    

The partnership is expected to report its fourth-quarter 2013 results on Feb 5, 2014, before the opening bell. The Zacks Consensus Estimate for Magellan Midstream’s fourth-quarter stands at 82 cents per unit.

Tulsa, Oklahoma-based Magellan Midstream is a master limited partnership (MLP) that owns and operates a diversified portfolio of energy infrastructure assets. The partnership mainly transports, stores, and distributes refined petroleum products and, to a lesser extent, ammonia.

Magellan Midstream currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.

Meanwhile, one can look at better-ranked players in the oil and gas pipeline MLP sector like Crestwood Equity Partners LP (CEQP), Enbridge Energy Management LLC (EEQ) and Energy Transfer Partners LP (ETP). All the partnerships carry a Zacks Rank #2 (Buy).

Read the Full Research Report on MMP
Read the Full Research Report on ETP
Read the Full Research Report on EEQ
Read the Full Research Report on CEQP

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