BGH’s Acquisition Outlook Is Impressive

Analyst Ethan Bellamy of Wunderlich Securities reiterates his "buy" rating on Buckeye GP Holdings LP (NYSE: BGH). The target price for BGH has been raised from $30.50 to $38.00.

Wunderlich Securities said that the target price had been raised following the 4Q09 results and an offering worth $125 million in 2Q10 and 1Q11 by Buckeye Pipeline Partners (BPL) "in order to fund a $120MM acquisition in 3Q10 and a $500MM expansion project during FY11.”

Wunderlich Securities added, “Based on the acquisition outlook and an extension of our distribution model through 2015, we are raising our valuation to $38 from $30.50. We continue to prefer to be positioned in BGH vs. BPL to benefit from any upside from equity offerings.”

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