Williams Partners LP (WPZ) Gets Equal-weight Rating

Morgan Stanley Research has given Equal-weight rating for Williams Partners LP (NYSE: WPZ).

Analyst Stephen J. Maresca believes that the share price will rise in absolute terms over the next 45 days. This is because of an announced restructuring. Williams Partners LP announced a transformative transaction which was expected to unlock value at its MLPs (WPZ and WMZ) and E&P levels.

WMB is ‘dropping down’ most of its pipeline and midstream assets and WMZ LP/GP interests into a larger WPZ. The transaction will increase WPZ’s share of fee-based business, increase its 1Q distribution by 3.5% and result in an investment grade rating, in our view. While shares have responded positively, analysts believe that there is room for further upside as value from drop down assets are better understood and valued by investors.