2019 Midstream Outlook (Alerian): Midstream Fundamentals Are Strong

Energy

Potential Catalysts

  • Oil price improvement
  • Generalist or new investors entering the space
  • MLP unit buybacks (likely limited)
  • Major private equity transaction

Tailwinds

  • Conclusion of restructurings
  • Positive momentum from strong 2Q18 and 3Q18 results
  • Solid guidance for 2019
  • Becoming more investable (IDR eliminations, self-funding equity, distributions stabilizing)

Headwinds

  • Oil price weakness
  • Underinvestment in energy

Bottom Line

  • Fundamentals for midstream remain strong
  • Several companies guiding to significant EBITDA growth in 2019
  • MLP and midstream space becoming more investable

Alerian 2019 Midstream Outlook, December 18, 2018

Image Source: Latham & Watkins

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