Standard & Poor's said on March 7 that it was downgrading units of TC Pipelines (Nasdaq: TCLP) from Buy to Hold based on valuation. The TCLP unit price has increased over 11 percent in the past four months.
S&P said it was encouraged that the partnership's Great Lakes segment has sold all its available capacity through October 2011, and that its Northern Border segment is fully contracted through March 2012. It believes that TCLP will increase its cash distribution 3.4 percent to $3.06 per unit in 2011.
S&P maintained its 2011 earnings per unit estimate of $2.89. It also kept its target price of $58, based on TCLP's 12-month forward distribution estimate and target yield of 5.3 percent, in line with its peers.