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Enterprise (EPD) Q4 Earnings Top, '21 Growth Capital Set at $1.6B
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Enterprise Products Partners L.P. (EPD - Free Report) reported fourth-quarter 2020 adjusted earnings per limited partner unit of 51 cents, beating the Zacks Consensus Estimate by a penny. The bottom line, however, declined from the year-ago quarter’s 54 cents per unit.
Revenues declined to $7,044 million from $8,005 million in the prior-year quarter. However, the top line beat the consensus estimate of $6,697 million.
The better-than-expected earnings were supported by increased transportation volumes in Petrochemical & Refined Products Services, along with higher margin from the Midland-to-ECHO Pipeline System. The positives were partially offset by lower natural gas pipeline transportation volumes.
Enterprise Products Partners L.P. Price, Consensus and EPS Surprise
Gross operating income at NGL Pipelines & Services increased from $1,136 million in the year-ago quarter to $1,144.2 million on higher margin from NGL marketing activities. Moreover, higher NGL marine terminal volumes benefited the segment. Additionally, its Mont Belvieu NGL fractionator units witnessed increased volumes.
Natural Gas Pipelines and Services’ gross operating income decreased to $225.5 million from $238 million in the year-ago quarter. The downside is owing to lower natural gas pipeline transportation volumes. Its East Texas and Haynesville gathering pipeline systems witnessed lower gathering volumes.
Crude Oil Pipelines & Services recorded gross operating income of $428.2 million, which increased from $416.1 million in the prior-year quarter owing to an increase in crude oil export activities at the marine terminals. Moreover, higher margin from the Midland-to-ECHO Pipeline System boosted the segment.
Gross operating income at Petrochemical & Refined Products Services amounted to $296.8 million compared with $233.7 million a year ago. The improved performance was owing to an increase in segment pipeline transportation volumes. Also, marine terminal volumes jumped 20% year over year.
DCF
Quarterly distribution improved 1.1% year over year to 45 cents per common unit or $1.80 per unit on an annualized basis.
Adjusted distributable cash flow was $1,628.8 million, down from $1,633.6 million a year ago, and provided coverage of 1.6x. Notably, the partnership retained $640 million of distributable cash flow in the fourth quarter.
Financials
For the quarter, Enterprise Products’ total capital expenditure was $624 million. While $556 million was used for growth projects, $68 million was utilized for sustaining operating activities.
As of Dec 31, 2020, its outstanding total debt principal was $30.1 billion. Enterprise Products’ consolidated liquidity amounted to $6.1 billion, which included unrestricted cash on hand of $1.1 billion and available borrowing capacity of $5 billion.
Outlook
The partnership invested $3 billion in growth capital projects for 2020. Its sustaining capital expenditure for the year reached $294 million. Enterprise Products reiterated growth capital investment projections for 2021 and 2022 at $1.6 billion and $800 million, respectively. It expects 2021 sustaining capital to be $440 million. It has three major growth capital projects in the pipeline that are expected to come online this year, which will provide the partnership with incremental cash flows. Overall, Enterprise Products currently has around $3.6 billion capital projects under construction.
The partnership expects energy demand to rise in the long run. Global economic recovery is boosting demand, which is further supported by multiple vaccine rollouts and government stimulus.
Cactus’ bottom-line estimates for 2021 have witnessed two upward revisions and no downward movement in the past 60 days.
Suncor’s sales for 2021 are expected to increase 16.5% year over year.
Ameresco’s bottom line for 2021 is expected to increase 19.6% year over year.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Enterprise (EPD) Q4 Earnings Top, '21 Growth Capital Set at $1.6B
Enterprise Products Partners L.P. (EPD - Free Report) reported fourth-quarter 2020 adjusted earnings per limited partner unit of 51 cents, beating the Zacks Consensus Estimate by a penny. The bottom line, however, declined from the year-ago quarter’s 54 cents per unit.
Revenues declined to $7,044 million from $8,005 million in the prior-year quarter. However, the top line beat the consensus estimate of $6,697 million.
The better-than-expected earnings were supported by increased transportation volumes in Petrochemical & Refined Products Services, along with higher margin from the Midland-to-ECHO Pipeline System. The positives were partially offset by lower natural gas pipeline transportation volumes.
Enterprise Products Partners L.P. Price, Consensus and EPS Surprise
Enterprise Products Partners L.P. price-consensus-eps-surprise-chart | Enterprise Products Partners L.P. Quote
Segmental Performance
Gross operating income at NGL Pipelines & Services increased from $1,136 million in the year-ago quarter to $1,144.2 million on higher margin from NGL marketing activities. Moreover, higher NGL marine terminal volumes benefited the segment. Additionally, its Mont Belvieu NGL fractionator units witnessed increased volumes.
Natural Gas Pipelines and Services’ gross operating income decreased to $225.5 million from $238 million in the year-ago quarter. The downside is owing to lower natural gas pipeline transportation volumes. Its East Texas and Haynesville gathering pipeline systems witnessed lower gathering volumes.
Crude Oil Pipelines & Services recorded gross operating income of $428.2 million, which increased from $416.1 million in the prior-year quarter owing to an increase in crude oil export activities at the marine terminals. Moreover, higher margin from the Midland-to-ECHO Pipeline System boosted the segment.
Gross operating income at Petrochemical & Refined Products Services amounted to $296.8 million compared with $233.7 million a year ago. The improved performance was owing to an increase in segment pipeline transportation volumes. Also, marine terminal volumes jumped 20% year over year.
DCF
Quarterly distribution improved 1.1% year over year to 45 cents per common unit or $1.80 per unit on an annualized basis.
Adjusted distributable cash flow was $1,628.8 million, down from $1,633.6 million a year ago, and provided coverage of 1.6x. Notably, the partnership retained $640 million of distributable cash flow in the fourth quarter.
Financials
For the quarter, Enterprise Products’ total capital expenditure was $624 million. While $556 million was used for growth projects, $68 million was utilized for sustaining operating activities.
As of Dec 31, 2020, its outstanding total debt principal was $30.1 billion. Enterprise Products’ consolidated liquidity amounted to $6.1 billion, which included unrestricted cash on hand of $1.1 billion and available borrowing capacity of $5 billion.
Outlook
The partnership invested $3 billion in growth capital projects for 2020. Its sustaining capital expenditure for the year reached $294 million. Enterprise Products reiterated growth capital investment projections for 2021 and 2022 at $1.6 billion and $800 million, respectively. It expects 2021 sustaining capital to be $440 million. It has three major growth capital projects in the pipeline that are expected to come online this year, which will provide the partnership with incremental cash flows. Overall, Enterprise Products currently has around $3.6 billion capital projects under construction.
The partnership expects energy demand to rise in the long run. Global economic recovery is boosting demand, which is further supported by multiple vaccine rollouts and government stimulus.
Zacks Rank & Key Picks
The partnership currently has a Zacks Rank #3 (Hold). Some better-ranked players in the energy space include Cactus, Inc. (WHD - Free Report) , Suncor Energy Inc. (SU - Free Report) and Ameresco, Inc. (AMRC - Free Report) , each holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cactus’ bottom-line estimates for 2021 have witnessed two upward revisions and no downward movement in the past 60 days.
Suncor’s sales for 2021 are expected to increase 16.5% year over year.
Ameresco’s bottom line for 2021 is expected to increase 19.6% year over year.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>