Magellan Midstream Partners Earnings: Here’s Why Investors are Buying Shares Now

Magellan Midstream Partners LP (NYSE:MMP) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 1.7%.

Magellan Midstream Partners LP Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 27.45% to $0.65 in the quarter versus EPS of $0.51 in the year-earlier quarter.

Revenue: Decreased 1.25% to $443.9 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Magellan Midstream Partners LP reported adjusted EPS income of $0.65 per share. By that measure, the company beat the mean analyst estimate of $0.54. It missed the average revenue estimate of $461.79 million.

Quoting Management: “Magellan continues to generate stronger-than-expected financial results for 2013 driven by our solid fee-based transportation and terminals business and a favorable pricing environment for our commodity-related activities,” said Michael Mears, chief executive officer. “In addition to strong financial performance, Magellan successfully commissioned two significant industry projects during the second quarter of 2013 — start-up of our Longhorn pipeline with initial crude oil deliveries to the Houston Gulf Coast refining region and beginning condensate deliveries to the Corpus Christi petrochemical market via our Double Eagle pipeline joint venture.”

Key Stats (on next page)…

Revenue decreased 11.78% from $503.2 million in the previous quarter. EPS increased 30% from $0.50 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.54 to a profit $0.55. For the current year, the average estimate has moved up from a profit of $2.24 to a profit of $2.26 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)