On Monday, Stifel raised its price target on Plains GP Holdings, LP (NASDAQ:) to $23.00, up from a previous target of $22.00, and reiterated a buy rating on the stock. The firm cited the company’s strong position as a major transporter of crude oil from the Permian Basin, and expected it to benefit from increased volumes in the coming years.
The analyst noted that the joint venture between Plains GP Holdings and Oryx is expected to secure additional barrels for the company’s long-haul pipelines in the long term. This strategic partnership is expected to enhance the company’s ability to handle growing transportation requirements.
Plains GP Holdings has shown a significant improvement in its financial position over recent years, including a significant increase in distributions of around 20%. This is seen as a reflection of the company’s improved financial health and commitment to rewarding stakeholders.
The company’s prospects are boosted by the expectation of generating significant free cash flows in the future. According to Stifel, this financial strength is likely to support Planes in generating increased capital returns for its shareholders.
Plains GP Holdings’ strategic initiatives and financial performance have positioned it positively for Stifel, reflected in the price target upgrade and sustainable buy rating. The company’s focus on key transportation routes and partnerships, financial improvement, and potential for capital gains are key factors in Stifel’s positive outlook.
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