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Update: Spectra Energy Earnings

Spectra Energy (SE) announced results for the quarter and year ended Dec. 31, 2014. For the quarter, sales of $1.6B beat consensus by $10 million, while EBITDA of $810 million grew 2.9% year over year from $787 million. For the year, distributable cash flow was also up $168 million or 13% year over year, leading to dividend coverage of 1.6x.

As we noted in our initiation article, Spectra has an array of pipeline projects that could spur strong growth. During Q4 of 2014, Spectra Energy placed the Kingsport Expansion into service, earlier than expected. Also, Spectra continues to develop the Access Northeast project and tried to gauge interest in additional storage capacity on its Express-Platte system. We believe that further announcement of successful project execution can lead to shifting investor sentiment towards SE, and US transmission in particular.

We continue to like Spectra's ability to deploy capital effectively. The… Read More …