- MPLX (MPLX +1.6%) is higher after Morgan Stanley (NYSE:MS) upgrades shares to Overweight from Equal Weight with a $40 price target, saying it is not affected by the Federal Energy Regulatory Commission's tax ruling on MLPs.
- MPLX eliminated its incentive distribution rights earlier this year, which allowed it to reset its financial policy, which Stanley says means it is now "relatively advantaged" vs. peers, with a debt/EBITDA ratio of 3.6x at year-end 2017 and a financing plan that does not require equity issuance.
- Stanley also upgrades Dominion Midstream Partners (DM -0.6%) to Equal Weight from Underweight with a $17 price target even though the MLP is "substantially" exposed to the tax changes via Questar Gas, Carolina Gas and Iroquoi.
- BUt the firm downgrades Buckeye Partners (BPL -1%) to Equal Weight from Overweight with a $44 target, cut from $60, citing FERC's move to begin discussions on its 2021-25 liquids pipes index, which could result in a negative index adjustment in the mid-single digit range.
- Now read: Another Midstream MLP That Will Be Unaffected By New FERC Regulations
Original article