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Citigroup Energy & Utilities Conference Takeaways

Dominion Midstream Partners LP NYSE:DM, Tallgrass Energy Partners LP NYSE:TEP - Citigroup Energy & Utilities Conference Takeaways

NYMEX Light Sweet Crude, the more refined product relative to WIT and Brent, has gained just over 4 percent this week. Keeping with the sentiment we've seen since February, Citi's review of their Energy & Utilities conference highlight bullish management views over the coming months.

The conference, held last week in Boston, attracted 55 companies to discuss climate change, production growth, demand for refined products along with LNG commentary, bankruptcies, power demand and investments.

Citi notes that presentations from producers (the bank specifically notes Anadarko APC 1.16%, Occidental Petroleum OXY 0.25%, and Pioneer Natural Resources PXD 0.4%) showed a lack of commitment to enter 2017 hedge programs to lock in the economics for drilling.

Gasoline inventories continue to climb, but the outlook for margins remains constructive in lieu of questionable supply/demand economics.

Firms present at the conference also painted a constructive outlook for U.S. natural gas fundamentals citing positive trends around U.S. gas exports.

Citi remains Buy rated on Dominion Midstream Partners DM 0.57%, Tallgrass Energy TEP 7.74%, and Tallgrass Energy GP TEGP 12.04%, saying the companies are positioned to capitalize on natural gas demand growth.

Citi maintains Buy ratings on Targa Resources TRGP 1.15%, ONEOK OKE 0.5% and Oneok Partners OKS 1.51% citing the companies stories around natural gas liquids (NGLs).

Lastly, Citi says Marathon Petroleum MPC 1.23% and MPLX LP MPLX 0.09% remain Buy rated the heels of benefits derived from strong product demand and the NGL recovery.

Apr 2016BarclaysAssumesOverweight
Feb 2016Morgan StanleyInitiates Coverage onOverweight
Nov 2015Evercore ISI GroupInitiates Coverage onBuy

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