What to Buy in DCP Stock
If you've been wondering what to buy in DCP stock, you've come to the right place. Read on to learn more about the company's history, ESG efforts and the recent deal with Phillips 66. With the stock's recent rise, this is a great time to buy shares. But before you jump in, it's important to consider some of the major risks associated with buying shares.
Investors should keep an eye on the company's recent deal with Phillips 66
Phillips 66 has announced a deal with DCP Midstream GP, LLC. This could mean that the company will soon get a new pipeline to move oil from the Permian Basin to the Gulf Coast. The pipeline would transport up to 130,000 barrels per day and is expected to be operational by the second half of next year.
For a while, the energy industry was in turmoil, but demand is rebounding, especially in the U.S. Several major construction projects have been completed or are coming online. Demand for distillate is also strong. However, Phillips 66 is coming off a difficult year. And it needs to report similar results in its midstream and refining operations.
There are a lot of options for investors interested in getting in on this deal. They can choose between buying the shares or using the cash.
While the deal hasn't been approved yet, the deal has received the green light from the board of directors. It was also unanimously approved by the board of DCP Midstream GP, LLC, which is comprised of independent directors.
Its recent deal with Enbridge
Enbridge (TSX, NYSE:ENB) and Phillips 66 (NYSE:PSX) recently announced a deal to swap interests in two of their jointly owned oil pipelines, DCP and Gray Oak. The transaction is expected to close in the second quarter of 2023.
As part of the agreement, the two companies have agreed to realign their economic and governance interests in their joint ventures. This move is expected to result in an incremental $1 billion of adjusted EBITDA from the combined entity. Approximately $400 million of cash is expected to be paid to Enbridge from the merged entity.
DCP is one of the largest midstream players in the US. It processes natural gas and natural gas liquids, and it owns and operates 57,000 miles of natural gas and natural gas liquids pipelines. These assets include 50 plants and nine states in major producing regions.
In addition, the new JV structure will boost earnings, simplify operations, and expand the company's solar self-power strategy. Additionally, the deal will strengthen the low-risk pipeline/utility model.
Its recent ESG efforts
The global private equity firm DCP is committed to responsible investment. As such, the firm's recent ESG efforts have been focused on a number of themes. They include promoting standardized breeding in the animal agriculture industry, investing extensively in food safety, and integrating sustainable development into portfolio companies' operations.
The firm's management team encourages its portfolio companies to use benchmark-driven insights to help guide sustainable development. This includes incorporating renewable and alternative energy into their operations.
In order to effectively manage ESG, a company must establish policies and procedures. These include developing a robust data management system. A robust system may include automated checks, secure access, and data analytics. It may also be necessary to obtain third-party assurance.
One of the most important challenges for companies implementing ESG measures is the availability of accurate, relevant data. While some companies may rely on pre-existing ERP systems or manual spreadsheets, these are not always sufficient for robust review.
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