Back to top

Analyst Blog

On April 8, 2014, the units of Buckeye Partners, L.P. (BPL - Analyst Report) touched a 52-week high of $77.20. The unit price was finally closed at $76.26, up 0.4% from the previous day’s closing. We believe that the partnership’s systematic capital investments in growth projects, positive impact from the acquisition of several Hess Corporation’s (HES - Analyst Report) assets and payment of cash distribution at regular intervals have led to the surge in unit price.

We appreciate Buckeye Partners’ continuous effort towards expansion of its asset base. The partnership plans to invest $280–$310 million in 2014 under its growth capital projects. In 2013, Buckeye Partners invested substantial amount to expand its crude oil rail and butane blending capabilities. Currently, the partnership is in the middle of development at the Perth Amboy Terminal. The scheduled completion of these projects will enable Buckeye Partners to meet the increasing demand from the upstream players.

In addition to extending existing operations, Buckeye Partners is also pursuing an inorganic growth strategy to enhance its service capacity. In Dec 2013, the partnership completed the acquisition of 20 liquid petroleum products terminals from Hess Corporation. This acquisition enabled Buckeye Partners to increase its storage capacity by around 39 million barrels.

Apart from utilizing funds for enhancing midstream portfolio, Buckeye Partners also follows a practice of regular payout of cash distribution. Since 1986, the partnership has paid cash distribution every quarter. In Feb 2014, Buckeye Partners increased its quarterly cash distribution rate by 4.8% year over year to $1.875 per unit.

During fourth-quarter 2013 earnings call, Buckeye Partners announced that it has modified the operating divisions and reorganized the reporting segments as per its long-term objectives.

Buckeye Partners currently has a Zacks Rank #2 (Buy). Some other stocks worth considering in the oil and gas pipeline industry include Enterprise Products Partners L.P. (EPD - Analyst Report) and Magellan Midstream Partners LP (MMP - Analyst Report), each carrying a Zacks Rank #2 (Buy).

Read the Full Research Report on EPD
Read the Full Research Report on HES
Read the Full Research Report on MMP
Read the Full Research Report on BPL


Zacks Investment Research

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
SYNAPTICS I… SYNA 78.11 +8.14%
GREEN PLAIN… GPRE 39.41 +5.12%
PILGRIM'S P… PPC 28.82 +3.08%
SKYWORKS SO… SWKS 52.07 +2.58%
CLAYTON WIL… CWEI 109.08 +2.51%