Plains Delivers Good Q3 Results and Boosts 2022 Guidance; Targets Material Distribution Increases

Plains turned in good third-quarter results, in our view, with higher volumes and spreads across its oil and natural gas liquids businesses, driving a modest boost in 2022 guidance. 2022 EBITDA guidance is now $75 million higher at $2.45 billion. For 2023, current natural gas liquids spreads point to about $100 million of downside compared with $495 million in 2022 EBITDA from its natural gas liquids business. However, we project ongoing Permian oil volumes strength in its crude oil business to offset the weakness to keep 2023 EBITDA flat with 2022. After updating our models, we are maintaining our $13 fair value estimate and no-moat ratings for the Plains entities.