2020 might have brought down the Enterprise Products Partners (NYSE: EPD) stock price by a wide margin. But stock market analysts still feel there is enough room for growth as EPD stocks have started gaining fresh momentum.
Analysts Report EPD Stocks Have Strong Upside Potential
The current EPD stock price is listed at $17. But this is still 38% down. The company has a lot of making up to do from the COVID-affected price-fall since the beginning of 2020. Before COVID-era, EPD stocks had a high of $25. This was last seen in February before the prices dropped considerably to a low of $12 in the month of March.
EPD stocks suffered a massive 205 drop in 2020 H1 revenues. In spite of this, Enterprise Products Partners’ analysts still believe that there is a lot of upside potential in EPD stocks. But this is not a guess. Analysts who study EPD stocks have suggested that there are a number of reasons for this claim. Despite the 20% revenue decline earlier this year, there was a 3% rise in EPD’S natural gas liquids (NGL) volumes of transportation. This represents the company’s strong fundamentals. In addition to this, the declining inventories of crude oil in the recent past has made analysts believe that EPD stocks still have a sizable potential for growth in the near future.
EPD Stocks Vis-à-Vis S&P 500 Stocks
EPD stock value can be better understood in contrast to the broader market performance during the same time. If we consider the period from the last quarter of 2019 to the current moment, we can trace that EPD stock value went down from a $26.34 in December 2019, to $24.80 in February 2020, to a whopping $12.64 in March 2020 and then a gradual rise to $17.21 at present.
In comparison to this, S&P 500 reached a massive high on February 19 right after China announced its containment plans and WHO declared the COVID-19 crisis as a global pandemic. However, this high doesn’t remain for long as S&P 500 faces a drop of 34% since the February peak on March 23. This happens right after the massive crash in oil prices that occurred during the middle of March. Since then, S&P 500 has recovered almost 51% after the 1st round of stimulus checks that infused liquidity into the market.
Enterprise Products Partners’ stocks had faced a similar crisis during the financial crisis of 2007-2008. EPD stocks fell 21% after its peak, however, the stocks rose in the following year to make a gain of approximately 54% during 2009-2010. However, S&P 500, during this same time, fell by 51% but made a comeback of only 48% by 2010.
This suggests that even though EPD stocks are currently going through a decline, they look stronger than ever.