![]() "We expect natural gas and LNG to remain front-of-mind throughout this quarter's earnings cycle," Credit Suisse analysts said in a note to clients. "Stocks are down, but free cash flow generation into 2023 shouldn't be, in our view," Raymond James analysts led by Justin Jenkins said.Īccording to analyst consensus, the 12 major North American midstream companies covered by S&P Global Market Intelligence should all record year-over-year gains in adjusted EBITDA and increased revenue.īacking billions of dollars of infrastructure with long-term, fee-based contracts has enabled the midstream sector to become a "free cash flow powerhouse" over the past year as capital spending fell, fueling buybacks and dividend growth, Alerian director of research Stacey Morris said in a recent note.Īnalysts said midstream companies' natural gas projects and exposure to LNG will likely remain in the spotlight, as investors continue to watch for signs that companies are pursuing new infrastructure growth opportunities. The analysts also pointed to the improved operating expense structures of midstream players after years of spending reductions, as well as stronger balance sheets and increased M&A activity, leaving companies with bigger and more stable asset bases that afford more marketing opportunities to mitigate market volatility. Kinder Morgan kicked off the reporting season July 20.įactors that bode well for midstream players include high oil and gas prices supported by a global energy shortage capital discipline on the part of US producers, which made supplies less vulnerable to price swings and "extremely significant" inflation-based contract rate adjustments in midstream fees for 20, Raymond James analysts said in a July 20 note to clients. ![]() Receive daily email alerts, subscriber notes & personalize your experience.Īnalyst predictions remained largely positive against a favorable backdrop for the sector, anticipating that management teams would use the earnings season to defend their company outlooks and spending plans and to project confidence about 2023. ![]()
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