Natural gas transporter and processor
Crosstex Energy L.P.
) has priced a public offering of 7,200,000 common units at
$20.33 a piece, with a 30-day over-allotment option for an
additional 1,080,000 units. The offering is expected to close on
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The master limited partnership (MLP) plans to use the proceeds
from this offering to finance capital expenditures associated
with pipeline projects - including the 130-mile, 12-inch
Cajun-Sibon natural gas liquids pipeline expansion - and for
general partnership purposes.
Crosstex Energy L.P. is a midstream natural gas partnership that
operates about 3,500 miles of pipeline, 10 processing plants, and
4 fractionators. Additionally, it is engaged in the operation of
barge terminals, rail terminal, product storage facilities, and
brine water disposal wells, apart from having an extensive truck
In the recently reported first quarter on May 8, Crosstex Energy
delivered a positive 34.8% earnings surprise - the first
outperformance in 4 quarters - propelled by solid contribution
from all business segments.
Following the better-than-expected results, units of the Dallas,
Texas-based energy midstream firm hit a 52-week high of $21.89 on
May 29. Considering that Crosstex Energy has already seen its
unit price climb some 30% since the beginning of the year, any
upside from here may be limited.
As a result, Crosstex Energy 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
Atmos Energy Corp.
Chesapeake Utilities Corp.
) as good buying opportunities. These natural gas distributors -
sporting a Zacks Rank #2 (Buy) - have solid secular growth
stories with potential to rise from current levels.