2018 Midstream Guidance

This new report identifies the key factors that are poised to give a much-needed boost to the U.S. oil and gas midstream sector in 2018. The report shows how East Daley’s 2018 overall adjusted-EBITDA forecasts skew positive versus current market consensus, indicating midstream sentiment may be too pessimistic.

The report says three themes will exist in 2018 that will impact the midstream sector. First, the market is being overly pessimistic on midstream companies as East Daley’s adjusted-EBITDA forecasts are skewed positive versus consensus estimates. Second, rising oil and gas production in 2018, despite lagging in 2017, will provide an earnings boost to midstream companies in most major U.S. basins. And third, some midstream companies, however, will be impacted negatively by large amounts of long-haul natural gas pipeline capacity contracts that will either be terminated or renewed at a lower-rate, putting downward pressure on earnings in some cases.

Key findings from the 2018 Guidance Outlook on the Midstream Sector:

  • East Daley’s analysis indicates that impending 2018 midstream financial guidance announcements could deviate significantly from market expectations.
  • East Daley’s 2018 overall adjusted-EBITDA forecasts skew positive vs. current market consensus, indicating midstream sentiment may be too pessimistic.
  • Pessimistic midstream sentiment, higher production growth, and natural gas contract risk are three major themes that will drive the midstream sector in 2018.

East Daley Capital is an energy asset research firm

that is redefining how markets view risk for midstream energy companies. In addition to using top-level financial data to forecast a company’s performance, East Daley delivers asset-level analysis that provides comprehensive, fact-based intelligence. Supported by a team of unbiased, experienced research analysts, East Daley provides its clients unparalleled insight into how midstream companies operate and generate cash flow. East Daley uses publicly available fundamental data and intersects that data with a company’s reported financials to break midstream companies down to asset-level cash flows. The result allows for more informed decisions.