NEW YORK (TheStreet) -- Energy-related master limited partnerships such as Linn Energy (LNCO) and NGL Energy Partners (NGL) have been slammed by the drop in oil prices, but Goldman Sachs thinks that may present a buying opportunity.
In a report published Tuesday, a team of Goldman Sachs analysts led by Theodore Durbin listed six MLPs as their top picks, seeing potential gains of well over 200% over the next 12 months, based on share prices after the close of trading Monday.
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Durbin didn't call a bottom on oil prices or MLP prices, but he did indicate that he expects a big turnaround eventually.
Neither he nor a Goldman Sachs spokeswoman responded to emails seeking clarification of aspects of the report.
But here are Durbin's picks.
1. Linn Energy
Despite listing it as a top pick, Durbin has a neutral rating on Linn Energy. He has a 12-month target price of $26, implying upside of more than 180%, based upon the close of trading Monday.
Durbin also sees Linn Energy paying out a yield of more than 26%, according to his report, which was published before the start of trading Monday.
Not everyone who follows MLPs is as sanguine on Linn Energy's prospects, however.
The Advisory Research MLP and Energy Income Fund (INFIX) doesn't own any Linn Energy shares, partly because it is much more exposed to commodity price swings than other MLPs, according to portfolio manager Quinn Kiley.
2. Enduro Royalty Trust (NDRO)
Durbin also has a neutral rating on Enduro. His $10 target price implies upside of more than 107%, based on the close of trading Monday.
Kiley said that Enduro looks attractive, given how far it has sold off, but he typically avoids royalty trusts because they are structured to exploit an existing asset rather than to keep buying new assets to fuel growth.
3. Targa Resources Corp. (TRGP)
4. Targa Resources Partners LP (NGLS)
Durbin has a 12-month price target of $170 on TRGP and $77 on NGLS, implying total returns of about 90%, based on Monday's closing prices. He also has a buy on both stocks, with TRGP a member of Goldman Sachs' conviction-list stocks, which are those about which it has the greatest confidence.
Targa is a "natural-gas-liquids logistics company," said Kiley, with TRGP as the general partner and NGLS as the limited partner of the same entity.
5. NGL Energy Partners
Durbin has a neutral rating on NGL Energy Partners, with a $41 price target, reflecting upside of 75%, not including a roughly 9% yield based on Monday's close.
Kiley described NGL Energy Partners as "a very diverse business," adding that "commodity price risk is somewhat dispersed for them across multiple lines of business."
He sees the shares as attractive.
6. Summit Midstream Partners (SMLP)
Durbin has a buy rating on Summit Midstream Partners and a $58 price target, reflecting upside of 71% based on Monday's close at $33.84. Summit also yields more than 6%.
Summit Midstream Partners focuses chiefly on the gathering and processing of natural-gas liquids.