Wells Fargo (NYSE:WFC) changed their rating on Blueknight Energy Partners, L.P. (OTC:BKEP), downgrading them from "Outperform" to "Market Perform," citing no quick fix in the short term for their restructuring.
"We’re downgrading BKEP as terms of the announced restructuring are less attractive than we had forecast. According to our preliminary analysis, the restructuring transaction is unlikely to result in potential unit price upside near term. While we still believe Vitol and new GP owner CharlesBank are likely to grow the partnership over time via organic investments and acquisitions (including dropdowns), near-term upside potential appears limited, in our view. Our model and estimates are being reviewed," said Wells.
Wells lowered their valuation range from $12-14 to $5-8. Blueknight closed Monday at $8.95.
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