Top 5 Transportation Stocks To Buy For 2015

Top 5 Transportation Stocks To Buy For 2015: Phillips 66 Partners LP (PSXP)

Phillips 66 Partners LP, incorporated on February 20, 2013, owns, operates, develops and acquires primarily fee-based crude oil, refined petroleum product and natural gas liquids (NGL) pipelines and terminals and other transportation and midstream assets. The Company's initial assets consist of the three systems, which include Clifton Ridge crude system, Sweeny to Pasadena products system and Hartford Connector products system. A refined petroleum product pipeline, terminal and storage system extending from Phillips 66's Sweeny refinery in Old Ocean, Texas, to its refined petroleum product terminal in Pasadena, Texas, and ultimately connecting to the Explorer and Colonial refined petroleum product pipeline systems and other third-party pipeline and terminal systems.

A crude oil pipeline, terminal and storage system located in Sulphur, Louisiana, that is the primary source for delivery of crude oil to Phillips 66's Lake Charles refinery. A refined petrol eum product pipeline, terminal and storage system located in Hartford, Illinois, that distributes diesel and gasoline produced at the Wood River refinery (a refinery owned by a joint venture between Phillips 66 and Cenovus Energy Inc.) to third-party pipeline and terminal systems, including the Explorer refined petroleum product pipeline system.

Advisors' Opinion:

• [By Tyler Crowe]

  No. 2: Phillips 66 Partners (NYSE: PSXP  ) , up 68.4%
  Like Tallgrass Energy Partners, Phillips 66 Partners is one of those investments that gives investors exposure to the energy space without the nausea that can come from volatile oil prices. However, this is a much more niche investment than other MLPs since it is a spinoff of Phillps 66's pipeline and logistics assets. So far, the partnership doesn't own very much, just a few refine! d product pipelines from Phillip 66's refineries as well as a crude import terminal and pipeline.

• [By Robert Rapier]

  Consider Phillips 66 Partners (NYSE: PSXP), which owns some of the midstream logistics assets of its sponsor, the refiner Phillips 66 (NYSE: PSX). Ordinarily we might consider such a midstream MLP to be a fairly conservative investment, but PSXP exploded out of the gate after its IPO and has continued to be one of the most lucrative MLPs since its IPO. In just the first half of this year, the unit price rose 110%. As the unit price rose and the yield continued to shrink, price targets were raised again and again by brokerage houses.

• [By Robert Rapier]

  Likewise, Phillips 66 Partners (NYSE: PSXP) has risen 154% since its IPO just under a year ago, pushing the yield down to 1.45%. So why do investors keep bidding the price higher with the yield so low? Because they have very aggressive expectations of  how the partnership will grow its distribution. Anything that falls short of those aggressive expectations could result in a sharp pullback in the unit price.

• [By Robert Rapier]

  The top performing MLP of the first half was Emerge Energy Services (NYSE: EMES), a supplier of sand used in hydraulic fracking (+146 percent). The second leading gainer with a gain of 110 percent was Phillips 66 Partners (NYSE: PSXP), which IPO'd a year ago and consists of midstream assets dropped down from its sponsor, Phillips 66 (NYSE: PSX).

source from Top Stocks For 2015:http://www.topstocksblog.com/top-5-transportation-stocks-to-buy-for-2015-3.html