Stocks to Buy: Targa Resources Partners LP (NGLS)
With a ticker like NGLS, there’s no mistaking what midstream firm Targa Resources Partners LP (NGLS) does for a living. And like the previously mentioned EPD, Targa is quickly becoming one of the best stocks to buy thanks to its LPG exports.
NGLS is already a big player when it comes to natural gas liquids and processing capacity at its facilities in the Gulf. However, sensing the opportunity, Targa is currently undergoing expansion projects to increase its exports of LPG. Construction started on a $480 million project back during the end of 2012. Phase 1 of the project expanded its export capacity to approximately 3.5 to 4 million barrels per month of LPG. Phase 2 — which will be completed by the third quarter of this year — will add an additional 2 million barrels per month worth of export capacity, or about 72 million barrels per year.
That project — along with the fact that NGLS doesn’t hedge propane and butane production — will allow it boost its margins and profits even further as prices for propane and LPG continue to rise on the backs of increasing exports.
NGLS has been one of the better stocks to buy for a while — shares have already gained about 30% over the last 52 weeks. However, that could just a beginning as the firm ramps up its LPG capacity.
EDITOR’S NOTE: Updated to clarify LPG figures.