EPD
Enterprise Products Partners L.P.
$39.63
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Fair Value
Trading 8.6% below fair value
You pay
$39.63
Bear
$34.70
Fair
$43.37
Bull
$52.04
Bear
$34.70
-12.5%
$2.85 × 13x P/E
Fair
$43.37
+9.4%
$2.85 × 16x P/E
Bull
$52.04
+31.3%
$2.85 × 19x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
13.9x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $38.57 from 45 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $43.37 per share.
Warnings
The company pays out 82% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples