Magellan Midstream downgraded to Equal Weight from Overweight at Wells Fargo

Wells Fargo analyst Praneeth Satish downgraded Magellan Midstream to Equal Weight from Overweight with a price target of $56, down from $57. The analyst is positive on midstream heading in 2023, believing the sector’s "solid" underlying fundamentals, "reasonable" valuations, and improved free cash flow should support outperformance on a relative basis. A combination of continued producer discipline should limit supply growth, which combined with OPEC+ action, should provide a floor for oil prices, Wells analysts tells investors in a research note. They expect a rebound in natural gas liquid demand as China re-opens, and for U.S. liquefied natural gas demand to stay robust buoyed by Europe and China. Wells makes a host of rating changes to reflect an emphasis on these themes "overlaid by relative valuations."