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Investing.com - UBS has reiterated a Buy rating and $38.00 price target on Enterprise Products Partners (NYSE:EPD) following the company’s agreement to sell a 40% joint interest in its Bahia pipeline to ExxonMobil. Trading at $31.89, EPD appears undervalued according to InvestingPro analysis, with analysts setting targets as high as $39.
The 550-mile Bahia pipeline has begun commissioning activities and will soon begin commercial operations with an initial capacity to transport 600mb/d of NGLs from the Midland and Delaware basins of West Texas to Enterprise’s Mont Belvieu fractionation complex.
The transaction is expected to close by early 2026 and will result in a subsequent expansion of Bahia’s capacity, according to UBS.
Upon closing, Enterprise and ExxonMobil plan to increase Bahia’s capacity by 400mb/d to 1,000 mb/d by adding incremental pumping capacity to the pipeline.
The companies will also construct a 92-mile extension of Bahia to ExxonMobil’s Cowboy natural gas processing plant in Eddy County, New Mexico, with the expansion and extension expected to be completed around the fourth quarter of 2027. With a market cap of $69 billion and a notable 6.84% dividend yield, EPD has maintained dividend payments for 28 consecutive years. InvestingPro offers a comprehensive research report on this low-volatility stock (Beta: 0.58) and 10+ additional ProTips.
In other recent news, Enterprise Products Partners LP reported its third-quarter 2025 earnings, showing a mixed financial performance. The company posted an earnings per share (EPS) of $0.61, falling short of the forecasted $0.67, an 8.96% negative surprise. However, it exceeded revenue expectations, reporting $12.02 billion against a forecast of $11.83 billion. Additionally, Enterprise Products Partners announced it has executed an agreement with ExxonMobil to sell a 40% stake in its Bahia natural gas liquids pipeline, with the transaction expected to close by early 2026, pending regulatory approvals. The pipeline is in the commissioning phase and will have a capacity to transport 600,000 barrels per day. In another development, the company has priced a public offering of $1.65 billion in senior notes across three tranches with varying maturities. These tranches consist of $300 million due in June 2028, $600 million due in January 2031, and $750 million due in January 2036. Furthermore, Enterprise Products Partners announced the appointment of Michael C. "Tug" Hanley as executive vice president and chief commercial officer, effective December 1, 2025.
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