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3 Pipeline Stocks That Will Win From Sheehan Pipeline's Bankruptcy

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Primoris Services Corp PRIM 1.07%, Quanta Services Inc PWR 2% and MasTec, Inc. MTZ 1.58% would be the key beneficiaries from the bankruptcy filing of Sheehan Pipeline Construction Company, according to a note from Avondale Partners.

Analyst Daniel Mannes noted that Sheehan, which filed for Chapter 11 bankruptcy last Friday, is a frequent competitor to Primoris, Quanta Services and MasTec on union-oriented pipeline work.

"We see MTZ, PRIM and PWR as all benefiting but the effective removal of a major player and see the possibility of all adding key people and equipment going forward," Mannes wrote in a note.

Among the three, the analyst said MasTec has already been a sizable beneficiary given the incremental work they picked up on DAPL project. Going forward, Mannes expects this to open up work on several projects in particular Rover and Atlantic Coast Pipeline (ACP) projects.

MasTec closed Tuesday trading at $21.91, Primoris at $23.77, Quanta at $22.89.

Mannes has a Market Outperform rating on all the three stocks.

DateFirmActionFromTo
Apr 2016Canaccord GenuityInitiates Coverage onBuy
Apr 2016Deutsche BankDowngradesBuyHold
Jan 2016Stifel NicolausAssumesBuy

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