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Enterprise Products Partners (EPD)
NYSE:EPD
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Enterprise Products Partners
(NYSE:EPD)77Outperform
Positive Factors
Financial Performance
Fee based Natural Gas Processing Volumes surpassed consensus expectations by 4.3%.
Project Expansion
EPD disclosed it added +$700mn to its '25/26 project backlog, focusing on Permian gathering, processing, and treating footprint, indicating a robust opportunity set.
Negative Factors
Project Development
Commercialization progress of the proposed VLCC project (Sea Port Oil Terminal - or 'SPOT') has been slower than expected, and discussions suggest EPD might abandon the project.
Enterprise Products Partners (EPD) vs. S&P 500 (SPY)
Market Cap
$71.66B
Dividend Yield6.35%
Average Volume (3M)5.22M
Price to Earnings (P/E)12.4
Beta (1Y)0.34
Revenue Growth12.71%
EPS Growth6.74%
CountryUS
Employees7,500
SectorEnergy
Sector Strength57
IndustryFossil Fuels
Share Statistics
EPS (TTM)2.69
Shares Outstanding2,165,700,000
10 Day Avg. Volume5,024,357
30 Day Avg. Volume5,219,602
Financial Highlights & Ratios
PEG Ratio1.84
Price to Book (P/B)N/A
Price to Sales (P/S)2.25
Price to Cash Flow (P/CF)7.60
P/FCF Ratio13.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$36.90Price Target Upside12.67% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Enterprise Products Partners Business Overview & Revenue Model
Company DescriptionEnterprise Products Partners L.P. is a leading North American provider of midstream energy services, primarily involved in the transportation, storage, and processing of natural gas, natural gas liquids (NGLs), crude oil, petrochemicals, and refined products. As a publicly traded partnership, Enterprise operates an extensive network of pipelines and storage facilities, serving as a critical link in the energy supply chain. The company is headquartered in Houston, Texas, and plays a significant role in the energy infrastructure sector, catering to a diverse customer base including major energy producers and consumers.
How the Company Makes MoneyEnterprise Products Partners generates revenue through a diverse range of midstream services. The company's primary revenue streams include fees collected for transporting volumes of natural gas, NGLs, crude oil, and petrochemicals through its extensive pipeline networks. Additionally, Enterprise earns income from storage services offered at its facilities, where customers store their energy products for future use or distribution. The company also processes natural gas and NGLs, extracting valuable components that are sold to industrial and commercial customers. Strategic partnerships and long-term contracts with energy producers and consumers further bolster its income, providing stable and predictable cash flows. Moreover, Enterprise benefits from its involvement in the export of liquefied petroleum gas (LPG) and other hydrocarbons, capitalizing on global energy demands.
Enterprise Products Partners Financial Statement Overview
Summary
Enterprise Products Partners exhibits strong financial performance across all verticals, with robust revenue growth, high profitability margins, and efficient cash flow management. The company's low debt-to-equity ratio and high return on equity underscore its financial stability and effective use of capital. While the decrease in free cash flow growth is a point of concern, the overall financial health of the company remains solid, positioning it well in the fossil fuels industry.Income Statement
Enterprise Products Partners shows strong financial performance with consistent revenue growth, evident from the 13.07% increase in revenue from 2023 to 2024. The company maintains healthy profitability margins with a gross profit margin of 100% and a net profit margin of 10.49% for 2024. EBIT margin and EBITDA margin are also robust at 13.05% and 13.05% respectively. These metrics highlight the company's efficient cost management and high profitability, contributing to a strong income statement score.82
Very Positive
Balance Sheet
The balance sheet reflects a solid equity position with a debt-to-equity ratio of 0.04, indicating low leverage. The return on equity (ROE) is impressive at 20.51%, showcasing effective use of equity to generate profits. An equity ratio of 37.23% suggests a stable capital structure. However, the high level of total liabilities relative to equity might pose a potential risk if not managed properly.75
Positive
Cash Flow
Enterprise Products Partners demonstrates strong cash flow management with a positive free cash flow of $3.57 billion in 2024. The free cash flow to net income ratio is 0.61, indicating that the company effectively converts its net income into free cash flow. Operating cash flow to net income ratio stands at 1.38, suggesting efficient cash generation from operations. However, the decrease in free cash flow from 2023 to 2024 indicates slight pressure on cash generation.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 56.22B | 49.72B | 58.19B | 40.81B | 27.20B | Gross Profit |
| 7.22B | 6.70B | 6.68B | 5.73B | 4.83B | EBIT |
| 7.34B | 6.93B | 4.97B | 4.23B | 2.98B | EBITDA |
| 7.34B | 9.05B | 8.96B | 7.99B | 7.12B | Net Income Common Stockholders |
| 5.90B | 5.53B | 5.49B | 4.64B | 3.78B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 583.00M | 180.00M | 76.00M | 2.82B | 1.06B | Total Assets |
| 77.17B | 70.98B | 68.11B | 67.53B | 64.11B | Total Debt |
| 1.15B | 29.07B | 28.64B | 29.87B | 29.87B | Net Debt |
| 567.00M | 28.89B | 28.56B | 27.05B | 28.81B | Total Liabilities |
| 857.00M | 42.22B | 40.41B | 41.09B | 38.73B | Stockholders Equity |
| 28.73B | 27.67B | 26.62B | 285.90M | -165.20M |
| Cash Flow | Free Cash Flow | |||
| 3.57B | 4.30B | 6.08B | 6.29B | 2.60B | Operating Cash Flow |
| 8.12B | 7.57B | 8.04B | 8.51B | 5.89B | Investing Cash Flow |
| -5.43B | -3.20B | -4.95B | -2.13B | -3.12B | Financing Cash Flow |
| -2.16B | -4.26B | -5.84B | -4.57B | -2.02B |
Enterprise Products Partners Technical Analysis
Neutral
32.75
Price Trends
32.61
Positive
31.40
Positive
29.60
Positive
Market Momentum
0.11
Positive
45.33
Neutral
26.63
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EPD, the sentiment is Neutral. The current price of 32.75 is below the 20-day moving average (MA) of 33.26, above the 50-day MA of 32.61, and above the 200-day MA of 29.60, indicating a neutral trend. The MACD of 0.11 indicates Positive momentum. The RSI at 45.33 is Neutral, neither overbought nor oversold. The STOCH value of 26.63 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for EPD.
Enterprise Products Partners Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
85 Outperform | $54.23B | 12.60 | 31.78% | 6.81% | 4.30% | 10.45% | |
81 Outperform | $62.45B | 14.17 | 13.40% | 7.06% | 5.20% | 18.35% | |
78 Outperform | $13.34B | 25.88 | 7.56% | 7.03% | 3.28% | -47.59% | |
77 Outperform | $71.66B | 12.42 | 20.78% | 6.35% | 12.71% | 6.74% | |
71 Outperform | $68.55B | 30.94 | 17.92% | 3.38% | 8.06% | -30.11% | |
64 Neutral | $57.36B | 17.76 | 18.11% | 4.35% | 24.16% | -6.58% | |
57 Neutral | $8.34B | 5.35 | -5.98% | 7.29% | 0.20% | -69.45% |
* Energy Sector Average
Performance Comparison
EPD
Enterprise Products Partners
32.75
6.54
24.95%
ET
Energy Transfer
17.70
3.60
25.53%
OKE
Oneok
89.74
15.72
21.24%
PAA
Plains All American
19.00
3.35
21.41%
WMB
Williams Co
54.61
19.78
56.79%
MPLX
MPLX
52.32
14.83
39.56%
Enterprise Products Partners Earnings Call Summary
Earnings Call Date: Feb 4, 2025 | % Change Since: -1.15% | Next Earnings Date: May 5, 2025
Earnings Call Sentiment Neutral
Enterprise Products Partners demonstrated strong financial and operational performance in 2024 with notable growth in exports and strategic acquisitions. However, significant challenges were highlighted in the SPOT project and petrochemical markets, coupled with mechanical issues in PDH facilities and competitive pressures in NGL pipelines.Highlights
Strong Financial Performance
2024 EBITDA reached $9.9 billion and DCF was $7.8 billion with a coverage ratio of 1.7 times. Adjusted cash flow from operations increased 4% to $2.3 billion for the fourth quarter compared to $2.2 billion in the previous year.
Record Operational Achievements
Enterprise set 12 financial records and 16 operational records. They moved 12.9 million barrels of oil equivalent a day in 2024 and 13.6 million barrels per day in the fourth quarter.
Significant Export Growth
Enterprise exported over 70 million barrels of hydrocarbons in December, aiming to export over 100 million barrels a month by 2027. They contracted with a new ethane offtake customer in Vietnam.
Strategic Acquisitions and Developments
Completed two processing plants in the Permian, purchased Pinon, and acquired JV interests in Midland to ECHO 1 crude oil pipeline and fractionators.
Cash Distribution Increase
Declared a distribution of $0.535 per common unit for the fourth quarter, a 4% increase over the previous year.
Lowlights
SPOT Project Challenges
The SPOT project faced significant delays due to federal bureaucracy, leading to an anchor customer opting out of their contract. The project has not yet gained enough traction for commercialization.
Petrochemical Market Headwinds
The petrochemical market is oversupplied globally, posing a challenge. The company is experiencing moderate improvement domestically but expects limited growth.
Mechanical and Design Issues in PDH Facilities
Current mechanical issues with PDH-1 and design limitations with PDH-2 are affecting operational efficiency and utilization rates.
High Costs and Competition in NGL Pipelines
Margins were impacted by higher costs and competition from new pipelines. Changes in Rockies flows affected the fee structure.
Company Guidance
During the Enterprise Products Partners L.P.'s Fourth Quarter 2024 Earnings Conference Call, the company provided several key financial metrics and operational highlights. The company reported an EBITDA of $9.9 billion for 2024 and distributable cash flow (DCF) of $7.8 billion, with a coverage ratio of 1.7 times and $3.2 billion of retained DCF. The fourth quarter saw net income attributable to common unitholders of $1.6 billion, or $0.74 per unit, up 3% from the previous year. Adjusted cash flow from operations increased to $2.3 billion in the fourth quarter, from $2.2 billion the same period last year. The company declared a distribution of $0.535 per unit, a 4% increase over the previous year. Operationally, Enterprise moved 12.9 million barrels of oil equivalent per day in 2024, with an increase to 13.6 million barrels per day in Q4. Looking ahead, Enterprise plans to expand its processing and export capabilities, including adding two gas processing plants in the Permian and expanding its ethane and ethylene terminal, aiming to export over 100 million barrels per month by 2027.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.