10 pipeline stocks to explore this summer

Summary

  • Pipeline stocks gain as the world economy rebounds from the pandemic slump.
  • EnLink Midstream (NYSE: ENLC) logs a net income of US$12.6 million in Q1 of 2021.
  • Sprague Resources’ (NYSE: SRLP) net income rises to US$48.8 million from US$46.7 million YoY.

Pipeline stocks are companies engaged in the storage and transportation of oil and natural gas products. These stocks are also known as midstream companies. Stock prices of these companies are on the path of recovery in recent times after the covid-linked slump in 2020.

The reopening of the world economy has brought cheers to the sector as production resumes, and new orders pour in. Many pipeline companies have witnessed growth in their stock prices.

We look into 10 pipeline stocks that may benefit from the strong economic rebound currently witnessed in the US.

Source: Pixabay.

Magellan Midstream Partners, L.P. (NYSE: MMP)

Magellan stores and distributes crude oil and petroleum products and owns the country’s longest pipeline system. It can store more than 100 million barrels of crude oil.

The stock closed at US$50.98 on June 21. Its prices rose by around 22% YTD.

Magellan has a market cap of around US$11.2 billion.

Its Q1 net income was US$221.3 million against US$287.6 million in the same period of 2020. It also posted a diluted net income of 99 cents per common share in the reporting period.

Also read: Top 10 energy stocks to explore in the US

EnLink Midstream, LLC (NYSE: ENLC)

The company offers marketing and supply services to gas and oil consumers and producers. It processes and distributes natural gas and crude oil. The stock closed at US$6.14 on June 21. Its prices increased by around 65% YTD. EnLink’s market capitalization is around US$2.9 billion.

In Q1 of 2021, it reported a net income of US$12.6 million, adjusted EBITDA of US$249.4 million, and net cash of US$225.8 million from operations. Additionally, it delivered a free cash flow of US$94.2 million and reduced debt by US$100 million.

Sprague Resources LP (NYSE: SRLP)

SRLP sells gas and oil products and provides storage services to clients.

The stock closed at US$27.48 on June 21. Its price increased by around 34% YTD. SRLP  has a market capitalization of around US$720 million.

Its net sales rose from US$959.9 million to US$1036.1 million in Q1. Net income increased from US$46.7 million to US$48.8 million YOY.

Adjusted gross margin was US$106.2 million against US$83.1 million YoY, and adjusted EBITDA increased from US$42.4 million to US$61.8 million YoY.


Also read:
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Source: Pixabay.

Cheniere Energy, Inc. (NYSE: LNG)

LNG is a producer of natural gas. It also provides services for procurement and transportation of natural gas.

Its stock traded at US$85.24 at the close on June 21. Its price increased by 45% YTD. LNG’s market cap is around US$21.7 billion.

Its net income was US$393 million, or US$1.56 per share, in Q1, 2021. Adjusted EBITDA was US$1.5 billion, up 40% YoY. The distributable cash flow was US$750 million.

Crestwood Equity Partners LP (NYSE: CEQP)

CEQP is engaged in processing, storing, and transporting natural gas. The stock closed at US$31.24 on June 21. Its price increased by nearly 73% YTD. Its market capitalization is US$1.9 billion.

In Q1, 2021, it reported a net loss of US$38.3 million, trimming losses from US$23.4 million YoY. Adjusted EBITDA was up by 9% from US$151.4 million to US$165.4 million YoY, and free cash flow was US$63.6 million.

Also read: Top 10 US-Listed Energy Stocks To Explore

Altus Midstream Company (NASDAQ: ALTM)

ALTM owns gas processing and transmission assets and operates in the Delaware Basin. It also owns equity in four Permian-to-Gulf Coast pipelines.

The stock closed at US$69.62 on June 21. Its price increased by around 51% YTD. Its market capitalization is US$1.1 billion.

It reported a net income of US$22 million and an estimated adjusted EBITDA of US$65 million in Q1, 2021, which ended March 31. Growth capital expenditure was US$21 million. Gathering and processing throughput volumes averaged 436 million cubic feet per day, and 72% of it was rich in gas.


Enable Midstream Partners, LP (NYSE: ENBL)

It operates natural gas and oil infrastructure assets, including 14,000 miles of supply pipeline network. It also operates 7,800 miles of interstate water pipeline.

The stock traded at US$9.4 at the close on June 21. The stock price increased by about 85% YTD. Its market capitalization is US$4.08 billion.

Its net income up by US$52 million from US$112 million to US$164 million in Q1 of 2021 ended March 31. Net cash from operation was up by US$23 million from $200 million to US$223 million, and adjusted EBITDA was up by US$42 million from $286 million to US$328 million.

Also read: 10 Hot Green Stocks To Explore This Summer

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