NEW YORK (TheStreet) -- Shares of MarkWest Energy Partners LP (MWE) are higher by 2.83% to $70.02 after RBC Capital raised its price target to $73 from $71 while maintaining a "sector perform" rating.
The firm also increased 2015 EBITDA estimates to $269.0 million from $260.6 million, with 2016 EBITDA estimates raised to $285.1 million from $284.8 million.
MarkWest Energy Partners LP is a master limited partnership engaged in the gathering, processing and transportation and marketing of natural gas, natural gas liquids (NGLs), and crude oil.
Yesterday, a partnership-- MPLX LP (MPLX) - Get MPLX LP Report --formed by Marathon Petroleum Corp. (MPC) - Get Marathon Petroleum Corporation Report announced MarkWest would become a wholly owned subsidiary of MPLX for $15.8 billion.
"We think door opens for additional offers into MarkWest, which could get closer to original headline 32% premium," RBC Capital analysts said.
Separately, TheStreet Ratings team rates MARKWEST ENERGY PARTNERS LP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate MARKWEST ENERGY PARTNERS LP (MWE) 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 good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and unimpressive growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Net operating cash flow has significantly increased by 78.80% to $200.93 million when compared to the same quarter last year. In addition, MARKWEST ENERGY PARTNERS LP has also vastly surpassed the industry average cash flow growth rate of -53.30%.
- The gross profit margin for MARKWEST ENERGY PARTNERS LP is rather high; currently it is at 52.96%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -1.94% trails the industry average.
- The debt-to-equity ratio is somewhat low, currently at 0.83, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.99 is somewhat weak and could be cause for future problems.
- The share price of MARKWEST ENERGY PARTNERS LP has not done very well: it is down 17.20% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 172.7% when compared to the same quarter one year ago, falling from $12.49 million to -$9.08 million.
- You can view the full analysis from the report here: MWE Ratings Report