Enterprise Products Partners L.P.

The stable outlook reflects our expectation that EPD will maintain a strong competitive position and solid credit measures. We expect the partnership to maintain adjusted debt to EBITDA of about 3.5x and distribution coverage above 1.5x in 2019 and 2020. We expect the partnership to continue to self-fund the equity portion of growth capital spending. We expect the partnership to opportunistically use its new multiyear $2 billion common unit buyback program. We could consider a negative rating action if debt to EBITDA rose above 4.25x on a sustained basis, which could occur if the partnership is more aggressive than our expectations with how it funds growth projects and acquisitions. We could consider a positive rating action on EPD if the

...The company could continue to opportunistically use share buybacks. Enterprise Products Partners L.P. (EPD) used an old buyback program dating back to December 1998 to buy back about 1.2 million units in December 2018. EPD announced a new $2 billion share buyback program in 2019, which we believe it could look to use over the next few years. However, the partnership has become a bit more conservative over the past couple of years, transitioning to more of a self-funding model, with slower distribution growth. In addition, we expect the partnership to maintain leverage in the 3.5x range. EPD's capital expenditures have increased on the growth of its natural gas liquids (NGL) and petrochemicals segments. EPD has had a relatively large capital spending budget, which we expect will continue. Total capital investments were $4.5 billion in 2018, of which approximately $300 million was sustaining capital spending. In 2019, we expect the partnership's capital spending budget to be $3.5 billion-$3.9...

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