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Crestwood (CEQP) Keeps Distribution Intact for First Quarter

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Crestwood Equity Partners LP recently announced first-quarter distribution payments. It has also scheduled first-quarter earnings release on Apr 27, before the market opens.

The partnership has kept first-quarter cash distribution payment unchanged at 62.50 cents per limited partner unit from the fourth-quarter 2020 level amid the current market volatility, while some companies — including Antero Midstream Corporation (AM - Free Report) — have opted for dividend cuts and halts. The primary reason behind the move is that Crestwood is least exposed to commodity price fluctuations since the partnership generates stable fee-based revenues from diverse midstream energy assets via long-term contracts.

Its new annualized distribution amounted to $2.50 per limited partner unit. Based on the closing price of $27.91 per unit on Apr 15, the stock has a distribution yield of almost 9%. Moreover, it announced a Class A preferred equity unit cash distribution of 21.11 cents. Both the distributions are expected to be paid on May 14 to Crestwood’s unitholders of record as of May 7.

Markedly, Crestwood announced several strategic transactions last month. Taking these into account, it estimates free cash flow after paying distributions within $130-$180 million, higher than the previous projection of $90-$160 million. This amount will likely be used for reducing the debt burden.

The Zacks Consensus Estimate for the partnership’s first-quarter earnings is pegged at 30 cents per unit, indicating a rise of 42.9% from the year-ago period. It has witnessed one downward and upward estimate revision in the past 60 days. First-quarter revenues are expected to rise 15.7% year over year to $842.3 million.

Price Performance

Crestwood’s units have surged 47.1% in the year-to-date period compared with the industry’s 21.2% growth.

Zacks Rank & Stocks to Consider

The partnership currently has a Zacks Rank #3 (Hold). Some better-ranked players in the energy space include CrossAmericaPartners LP (CAPL - Free Report) and Hess Corporation (HES - Free Report) , each having a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CrossAmerica’s bottom line for first-quarter 2021 is expected to surge 166.7% year over year.

Hess’ bottom line for 2021 is expected to jump 156% year over year.

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