Enterprise Products Partners LP EPD is a leading midstream energy player with lower exposure to volume and price risks. The Zacks Consensus Estimate for the partnership’s 2023 earnings per share has witnessed upward revisions in the past 30 days.
Factors Working in Favor
Enterprise Products, currently carrying a Zacks Rank #2 (Buy), has a stable business model and is not significantly exposed to the volatility in oil and gas prices. It generates stable fee-based revenues from its extensive pipeline network that spreads across more than 50,000 miles, transporting natural gas, natural gas liquids (NGLs), crude oil petrochemicals and refined products.
The midstream infrastructure provider has storage assets that can hold more than 260 million barrels of NGL, petrochemical, refined products and crude oil. These assets can store 14 billion cubic feet of natural gas. Enterprise Products has $6.1 billion of major capital projects under construction, which are likely to provide incremental fee-based revenues.
The partnership’s balance sheet has lower debt exposure than the composite stocks belonging to the industry. Its debt-to-capitalization ratio of 0.51 is lower than the industry’s 0.53. Notably, the ratio has persistently been lower than the stocks in the industry in the past few years. The liquidity profile of Enterprise Products is impressive, as it reported consolidated liquidity of $4 billion, which incorporates unrestricted cash, along with available borrowing capacity.
Other Stocks to Consider
Other top-ranked prospective players in the energy space are Murphy USA Inc. MUSA, Sunoco LP SUN and Eni SpA E. All companies sport a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Murphy USA is a leading retailer of gasoline. MUSA has more than 1,700 stores and has witnessed upward earnings estimate revisions for 2023 earnings in the past seven days.
Sunoco, a distributor of motor fuel to approximately 10,000 convenience stores, has a stable business model. For 2023, SUN has witnessed upward earnings estimate revisions in the past 30 days.
Eni is a leading integrated energy player. By mid-century, Eni has a goal to achieve carbon neutrality, which is quite encouraging. In the past 30 days, the stock has witnessed upward earnings estimate revisions for 2023.
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