Enterprise Products Partners (EPD) is expected to maintain "solid" organic growth, supported by its integrated natural gas liquids operations and the steady rise in Permian oil and NGL production, Truist Securities said in a note emailed Friday.
The company has several major capital projects scheduled to come online over the next few quarters, starting in Q3 2025, Truist said. "While we anticipate more major projects in the out years, we estimate annual capital spend should materially decrease beginning in 2026 combined with higher baseline organic business," it added.
"We believe [Enterprise Products] will continue to find opportunities to expand various existing pipelines and build out others to various potential data centers," the report said, adding that the company plans to expand pipelines and infrastructure, including a CO2 pipeline with Occidental Petroleum (OXY).
Projects like the Bahia NGL pipeline, which will run from the Delaware and Midland Basins in western Texas to the company's fractionation complex in Chambers County, Texas, and Neches River terminal, in Orange County, Texas, are set to boost cash flow, with further growth expected in Dallas and San Antonio to support data center demand, the report said.
NGL pipelines and services are projected to remain the primary drivers of gross operating margin, with "numerous major NGL projects coming online in the coming months," Truist said.
Truist has a buy rating on Enterprise Products and raised its price target to $40 from $37.
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