Sunoco Logistics Ups Distribution - Analyst Blog

By Zacks | January 25, 2013 AAA

Energy pipelines and terminals operator Sunoco Logistics Partners L.P. (SXL) declared that its general partner Sunoco Partners LLC raised its fourth quarter 2012 cash distribution to 54.5 cents per unit ($2.18 per unit annualized), representing an increase of approximately 5% sequentially and 30% year over year.

Sunoco Logistics' increased distribution is in sync with its goal of delivering disciplined growth to unitholders. The partnership boasts a consistent and improving financial policy with high distribution coverage. Sunoco Logistics' new distribution is payable on Feb 14, to unitholders of record as of Feb 8, 2013.

During the third quarter of 2012, the partnership increased its quarterly distribution by 10%. Also, its distributable cash flow increased 37.0% year over year to $149 million.

Philadelphia-based Sunoco Logistics is a master limited partnership (MLP). It acquires, owns, and operates a geographically diverse portfolio of refined product and crude oil pipelines and terminal facilities. Sunoco Logistics is organized into four segments -- Refined Products Pipeline System, Terminal Facilities, Crude Oil Pipeline System and Crude Oil Acquisition and Marketing.

With its low-risk and stable cash flow-generating energy infrastructure assets, Sunoco Logistics offers investors an opportunity to capture income growth through steadily rising cash distributions and capital appreciation.

The partnership continues to progress well on its growth initiatives, as evident from the recent successful completions of open seasons for the Permian Express Phase I, Allegheny Access and Mariner East projects.

Sunoco Logistics currently carries a Zacks Rank #1 (Strong Buy). Besides Sunoco Logistics, Magellan Midstream Partners L.P. (MMP) with Zacks Rank #2 (Buy), Williams Partners L.P. (WPZ) with Zacks Rank #3 (Hold) as well as MarkWest Energy Partners L.P. (MWE) with Zacks Rank #5 (Strong Sell) also increased their capital redeploying efforts recently through distribution increases.

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