Access Midstream Partners L.P.
) has priced an underwritten secondary public offering of
8,000,000 common units - being sold by a major owner - at $46.47
a piece, with a 30-day over-allotment option for an additional
1,200,000 units. The offering, announced Aug 12, will be offered
by Access Midstream pursuant to an effective shelf registration
statement filed with the Securities and Exchange Commission (SEC)
in last Dec.
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The natural gas pipeline master limited partnership (MLP) will
not get the net proceeds from this offering, which will go to the
seller - private equity firm Global Infrastructure Partners -
that owns a substantial number of Access Midstream units.
Access Midstream, which was spun off from U.S. gas producer
Chesapeake Energy Corp.
) in Jun 2012 and is now controlled by Global Infrastructure
Partners, is engaged in the gathering and processing of natural
gas. The partnership's operations are concentrated primarily in
the major gas shale plays that include the Barnett Shale, Eagle
Ford Shale, Haynesville Shale, Marcellus Shale, and Mid-Continent
regions of the U.S.
Having done a stellar job at boosting its presence in leading
unconventional plays and creating a best-in-class business model,
analysts are predicting strong earnings growth for Access
Midstream over the next couple of years. The 2013 Zacks Consensus
Estimate is $1.36, representing 13% earnings per unit growth over
2012. Next year's average forecast is $1.65, corresponding with
However, units of Access Midstream - currently trading at $46.81
- have already climbed some 35% since the beginning of the year.
Therefore, any upside from here may be limited.
As a result, Access Midstream currently retains a Zacks Rank #3
(Hold), implying that it is expected perform in line with the
broader U.S. equity market over the next one to three months.
Meanwhile, one can look at
Delek Logistics Partners L.P.
Pioneer Southwest Energy Partners L.P.
) as good buying opportunities. These energy pipeline
partnerships - sporting a Zacks Rank #2 (Buy) - have solid
secular growth stories with potential to rise from current