Scotiabank has reduced its price target for Enterprise Products Partners (NYSE: EPD) from $35.00 to $34.00. This adjustment was published in a research report on October 30, 2023. The brokerage firm maintains a “sector perform” rating for the oil and gas producer’s stock, reflecting a cautious outlook on the company’s performance in the current market environment.
Other financial institutions are also reassessing their positions on Enterprise Products Partners. On July 7, 2023, TD Cowen initiated coverage on the company, assigning a “hold” rating and a price target of $33.00. Following this, Weiss Ratings reaffirmed a “buy” rating on October 8, 2023, while Stifel Nicolaus increased its target price from $35.00 to $38.00 and gave a “buy” rating on October 31, 2023. In contrast, Morgan Stanley lowered its target to $33.00 with an “equal weight” rating on August 26, 2023.
Overall, sentiment among analysts remains positive, with one rating a “Strong Buy,” eight giving a “Buy,” and five assigning a “Hold” rating. According to MarketBeat.com, the consensus rating for Enterprise Products Partners is classified as a “Moderate Buy,” with an average target price of $36.00.
Recent Financial Performance
Enterprise Products Partners reported its quarterly earnings on October 30, 2023, revealing earnings per share (EPS) of $0.61. This figure fell short of analyst expectations, which had anticipated an EPS of $0.68, marking a miss of $0.07. The company generated revenues of $12.02 billion during the quarter, exceeding predictions of $11.83 billion. However, revenues decreased by 12.7% compared to the same period last year, when the company reported an EPS of $0.65. Analysts forecast an EPS of $2.90 for the current year.
Additionally, the company has declared a quarterly dividend of $0.545 per share, with payment scheduled for November 14, 2023. Shareholders on record as of October 31, 2023 will receive this dividend, which represents an annualized payout of $2.18 and a dividend yield of 7.0%. The current dividend payout ratio stands at 82.26%.
Stock Buyback and Institutional Interest
In a significant move, the Board of Directors authorized a stock buyback plan on October 30, 2023, allowing the company to repurchase up to $5.00 billion worth of shares. This initiative permits Enterprise Products Partners to buy back approximately 7.4% of its outstanding shares, a strategy often interpreted as an indication that the firm’s leadership views its stock as undervalued.
Recent activity among institutional investors shows a growing interest in Enterprise Products Partners. Brighton Jones LLC increased its holdings by 19.9%, owning 32,620 shares valued at approximately $1.02 million after acquiring an additional 5,425 shares. Similarly, Bank of New York Mellon Corp raised its stake by 7.1%, now holding 314,768 shares worth $10.74 million. Other notable increases include Penserra Capital Management LLC, which raised its stake by 6,192.9%, and Financial Counselors Inc., which saw a 51.2% increase in holdings.
In total, approximately 26.07% of Enterprise Products Partners’ stock is owned by hedge funds and other institutional investors, indicating robust institutional support for the company.
Enterprise Products Partners L.P. continues to be a significant player in the midstream energy sector, providing critical services to producers and consumers of natural gas, natural gas liquids, crude oil, petrochemicals, and refined products. The company operates across four key segments: NGL Pipelines & Services, Crude Oil Pipelines & Services, Natural Gas Pipelines & Services, and Petrochemical & Refined Products Services.
