Mplx (MPLX) Downgraded to “Sell” at Zacks Investment Research

Zacks Investment Research lowered shares of Mplx (NYSE:MPLX) from a hold rating to a sell rating in a report published on Friday, Zacks.com reports.

According to Zacks, “MPLX’s balance sheet reflects weakness and significant reliance on debt. This is reflected in its debt-to-capitalization ratio of 66.6%, much higher than the industry’s 48.6%. Notably, it reported first-quarter 2019 earnings of 61 cents per unit, beating the Zacks Consensus Estimate of 59 cents supported by contribution from dropdown transactions related to the L&S segment’s pipelines and refining logistics assets. However, decreased pricing on product sales in the G&P segment partially offset the positives. The surging direct operating expenses are a concern for the partnership. Also, its natural gas processing operations in the Utica shale play and Southern Appalachian region is showing a declining trend, which can hurt MPLX’s future earnings. Given these headwinds, MPLX seems like a risky bet that ordinary investors should exit.”

A number of other brokerages have also recently issued reports on MPLX. Evercore ISI began coverage on shares of Mplx in a report on Tuesday, February 5th. They set an outperform rating for the company. ValuEngine upgraded shares of Mplx from a sell rating to a hold rating in a report on Wednesday, March 20th. Credit Suisse Group decreased their price objective on shares of Mplx from $44.00 to $39.00 and set an outperform rating for the company in a report on Tuesday, March 12th. Barclays restated a buy rating and set a $38.00 price objective on shares of Mplx in a report on Wednesday, March 13th. Finally, UBS Group decreased their price objective on shares of Mplx to $41.00 and set an overweight rating for the company in a report on Thursday, February 7th. Two equities research analysts have rated the stock with a sell rating, two have issued a hold rating and nine have given a buy rating to the company’s stock. Mplx has a consensus rating of Buy and an average target price of $39.44.

Shares of MPLX traded up $0.63 on Friday, reaching $31.34. 4,057,487 shares of the company’s stock were exchanged, compared to its average volume of 1,559,889. The company has a debt-to-equity ratio of 1.95, a current ratio of 0.76 and a quick ratio of 0.69. The company has a market cap of $24.39 billion, a price-to-earnings ratio of 13.69, a price-to-earnings-growth ratio of 2.10 and a beta of 1.27. Mplx has a 12 month low of $28.32 and a 12 month high of $39.01.

Mplx (NYSE:MPLX) last posted its quarterly earnings results on Wednesday, May 8th. The pipeline company reported $0.61 earnings per share for the quarter, topping the Zacks’ consensus estimate of $0.59 by $0.02. The business had revenue of $1.65 billion during the quarter, compared to the consensus estimate of $1.64 billion. Mplx had a net margin of 28.57% and a return on equity of 27.44%. Mplx’s revenue for the quarter was up 15.9% compared to the same quarter last year. During the same period in the previous year, the firm posted $0.61 earnings per share. As a group, analysts expect that Mplx will post 2.44 EPS for the current year.

The business also recently declared a quarterly dividend, which will be paid on Wednesday, May 15th. Stockholders of record on Thursday, May 9th will be issued a $0.6575 dividend. This represents a $2.63 annualized dividend and a dividend yield of 8.39%. The ex-dividend date is Wednesday, May 8th. This is a boost from Mplx’s previous quarterly dividend of $0.65. Mplx’s dividend payout ratio is 114.85%.

Institutional investors have recently added to or reduced their stakes in the company. Toth Financial Advisory Corp acquired a new position in shares of Mplx in the first quarter valued at approximately $26,000. Lindbrook Capital LLC acquired a new position in Mplx during the fourth quarter worth $28,000. Legacy Advisors LLC acquired a new position in Mplx during the first quarter worth $44,000. Northwestern Mutual Wealth Management Co. boosted its holdings in Mplx by 67.2% during the first quarter. Northwestern Mutual Wealth Management Co. now owns 1,368 shares of the pipeline company’s stock worth $45,000 after purchasing an additional 550 shares during the last quarter. Finally, Executive Wealth Management LLC acquired a new position in Mplx during the fourth quarter worth $46,000. Institutional investors own 30.74% of the company’s stock.

Mplx Company Profile

MPLX LP owns and operates midstream energy infrastructure and logistics assets primarily in the United States. The company also provides fuels distribution services. It operates in two segments, Logistics and Storage, and Gathering and Processing. The company is involved in the gathering, processing, and transportation of natural gas; gathering, transportation, fractionation, storage, and marketing of natural gas liquids; and transportation, storage, and distribution of crude oil and refined petroleum products.

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