Plains Is Finally Seeing the Financial Benefits From Higher Permian Volumes in Q4

It took some patience as lower-fee pipelines (Wink-to-Webster) needed to fill up first, but Plains is finally beginning to see the financial benefits from its Permian asset base. Strong fourth-quarter results contributed to better-than-expected 2022 performance. As a result, its 2022 result and 2023 guidance are a bit better than we expected at $2.51 billion and $2.5 billion at the midpoint, compared with our $2.45 billion forecast. We expect to increase our $13 fair value estimate modestly to reflect the improved outlook and cash flows earned while maintaining our no-moat rating.