NEW YORK (TheStreet) -- Shares of BreitBurn Energy Partners L.P. (BBEP) are down by 7.63% to $5.45 in early afternoon trading on Monday, following a ratings downgrade to "sell" from "hold" at Wunderlich Securities.

The firm said it lowered its rating on the oil and gas partnership company which focuses on the acquisition, exploitation and development of oil, natural gas liquids, and gas properties, after BreitBurn cut its distribution by 50%, theflyonthewall.com reports.

On Sunday, BreitBurn announced that it intends to lower its common distribution to 50 cents per unit on an annualized basis in conjunction with its offerings of $350 million of perpetual convertible preferred units and $650 million of senior secured notes in simultaneous private offerings to investment funds managed by EIG Global Energy Partners.

"This distribution reduction is a very difficult, but prudent undertaking and an important component of our comprehensive liquidity, cash flow, and value management strategy," company CEO Halbert Washburn said in a statement.

"We have spent the better part of the past four months carefully examining our playbook and rewriting it to deliver the highest unit holder value over the medium to long-term. The steps that we have outlined today, along with additional actions underway including meaningful reductions to our operating expenses and G&A, will substantially increase our distribution coverage and better position us for long-term value creation, as we believe we can reinvest this additional liquidity at higher rates of return in the current environment," Washburn continued. 

Separately, TheStreet Ratings team rates BREITBURN ENERGY PARTNERS LP as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:

"We rate BREITBURN ENERGY PARTNERS LP (BBEP) a HOLD. The primary factors that have impacted our rating are mixed-some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow, a generally disappointing performance in the stock itself and generally higher debt management risk."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

• BBEP's very impressive revenue growth greatly exceeded the industry average of 19.9%. Since the same quarter one year prior, revenues leaped by 344.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
• The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 789.2% when compared to the same quarter one year prior, rising from -$58.79 million to $405.17 million.
• BREITBURN ENERGY PARTNERS LP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, BREITBURN ENERGY PARTNERS LP turned its bottom line around by earning $2.33 versus -$0.40 in the prior year. For the next year, the market is expecting a contraction of 89.3% in earnings ($0.25 versus $2.33).
• BBEP's debt-to-equity ratio of 0.89 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that BBEP's debt-to-equity ratio is mixed in its results, the company's quick ratio of 0.50 is low and demonstrates weak liquidity.
• Net operating cash flow has decreased to $62.84 million or 30.35% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
• You can view the full analysis from the report here: BBEP Ratings Report