Ethanol Project Sends JP Energy Partners LP (JPEP) Shares Up 43%


Shares of JP Energy Partners LP (NYSE:JPEP) are up huge this afternoon after the company announced that they are expanding their rail facilities at a current refined products terminal in North Little Rock, Arkansas. The expansion will allow for ethanol deliveries via train. Using 4.5 million gallons of storage specifically for ethanol, JP Energy will now be able to blend and distribute up to 9 million gallons of the fueal every month.

“We are excited to announce these two key enhancements to our North Little Rock terminal,” stated J. Patrick Barley, Executive Chairman and Chief Executive Officer of JP Energy. “The Magellan interconnection will provide our customers with greater operational flexibility for product deliveries from multiple production zones. Our ability to leverage our existing infrastructure at the site will allow us to provide the lowest cost ethanol in Central Arkansas and beyond.”

The blending and delivery will begin sometime in the second quarter of this year, if all goes as planned, and could bring in plenty of new revenues for JP Energy Partners LP (NYSE:JPEP). As for the costs, the projects will cost around $5 million.

The stock is up 43.92% or $1.12 following the news, hitting $3.67 per share. About 530,838 shares traded hands or up 175.31% from the average. JPEP has declined 80.34% since July 10, 2015 and is currently downtrending. It has underperformed the S&P500 by 70.14%.

From a total of 4 analysts covering JP Energy Partners LP (NYSE:JPEP) stock, 1 rate it a “Buy”, 1 a “Sell”, and 2 a “Hold”. This means that 25% of the ratings are positive. The highest target price is $12 while the lowest target price is $6. The mean of all analyst targets is $7.67 which is 108.99% above today’s ($3.67) stock price. JP Energy Partners LP was the topic of 8 analyst reports since August 11, 2015 according to the firm StockzIntelligence Inc. Barclays Capital downgraded shares on January 11 to a “Equal Weight” rating. Bank of America downgraded JPEP stock in a recent report from August 14 to a “Underperform” rating.

The institutional sentiment decreased to 0.5 in Q2 2015. It’s down 0.17, from 0.67 in 2015Q2. The ratio fall, as 4 funds sold all their JP Energy Partners LP shares they owned while 10 reduced their positions. 1 funds bought stakes while 6 increased their total positions. Institutions now own 13.27 million shares which is 2.74% more than the previous share count of 12.92 million in 2015Q2.

Arclight Capital Partners Llc holds 3.55% of its total portfolio in JP Energy Partners LP, equating to 3.67 million shares. Hite Hedge Asset Management Llc owns 577,514 shares representing 1.44% of their total US portfolio. Moreover, Whetstone Capital Advisors Llc has 0.63% of their total portfolio invested in the company, equating to 277,147 shares. The Illinois-based Advisory Research Inc has a total of 0.09% of their portfolio invested in the stock. Eagle Global Advisors Llc, a Texas-based fund reported 306,000 shares owned.

JP Energy Partners LP owns, operates, develops and acquires a portfolio of midstream energy assets in the United States. The company has a market cap of $163.85 million. The Firm operates through four divisions: Crude Oil Pipelines and Storage, Crude Oil Supply and Logistics, Refined Product Terminals and Storage, and NGL Distribution and Sales. It currently has negative earnings. The Company’s crude oil businesses are situated in areas, including the Permian Basin, Mid-Continent and Eagle Ford shale.