Plains All American Pipeline, L.P. (PAA.NASDAQ), a U.S.-listed midstream partnership with a market capitalization of roughly $14 billion, operates crude oil and natural gas liquids transportation, storage and logistics assets across North America.
Units fell about 2.7% in early New York trading after the company reported fourth-quarter and full-year 2025 results. The stock has trended lower in recent months and remains well below its 52-week high, reflecting broader pressure across the midstream energy sector amid softer crude prices and limited volume growth expectations.
Plains’ units have traded in a narrow range over recent weeks and remain near the lower end of their 52-week band. The stock’s recent trend reflects pressure across the North American midstream sector as crude price volatility, flat U.S. production growth expectations and tighter capital discipline limit upside catalysts for pipeline operators.
For the quarter ended Dec. 31, 2025, Plains reported:
Quarterly performance was driven by strength in the crude oil segment, partially offset by weakness in natural gas liquids (NGLs).
For full-year 2025, Plains posted:
Adjusted free cash flow for the year was negative $875 million, reflecting $2.651 billion of net cash outflows for acquisitions, primarily related to the EPIC Crude acquisition, now renamed Cactus III.
Plains is repositioning as a pure-play North American crude oil midstream operator.
Plains forecast 2026 adjusted EBITDA of $2.75 billion, plus or minus $75 million, including an estimated $100 million contribution from the NGL business for the first quarter before the divestiture closes.
The company expects adjusted free cash flow of about $1.8 billion in 2026, excluding proceeds from the NGL sale.
Management outlined “self-help” initiatives targeting $100 million of cost savings through 2027, with roughly half expected to be realized in 2026. Measures include operational consolidation, regional office closures and reductions in corporate general and administrative expenses. The program is designed to offset expectations for a largely flat Permian production profile next year.
Plains increased its annualized distribution by 10% to $1.67 per unit, with a $0.15 per unit increase payable in February 2026. Management targets ongoing annual distribution growth of $0.15 per unit.
The partnership also lowered its distribution coverage threshold to 150% from 160%, reflecting greater confidence in the stability of post-divestiture cash flows. Following the Canadian NGL sale, Plains said it may consider a one-time special distribution of up to $0.15 per unit to help offset potential tax liabilities for unitholders.
At year-end 2025, Plains reported a pro forma leverage ratio of 3.9 times, above its long-term target range of 3.25x to 3.75x. Management expects leverage to move back toward the midpoint of the target range immediately after the NGL divestiture closes.
The company ended the year with $2.0 billion of committed liquidity and an investment-grade credit profile. During 2025, Plains issued $750 million of senior unsecured notes and raised a $1.1 billion term loan to fund acquisitions and assumed debt from the EPIC transaction.
Plains’ results come as the broader midstream sector faces pressure from lower crude prices, muted production growth and heightened capital discipline. Peers including Enterprise Products Partners, Kinder Morgan and Magellan Midstream have reported similar trends, with fee-based stability offset by limited volume growth.
There were no immediate, widely reported analyst upgrades or downgrades following the earnings release. Market reaction reflected investor focus on the revenue decline, near-term EBITDA outlook and the execution of Plains’ strategic transition.
Plains enters 2026 with a simplified asset base, higher distributions and a focus on cost discipline. While the company expects stable cash generation, its near-term performance remains closely tied to crude oil market conditions and the successful execution of its NGL divestiture and efficiency initiatives.
The post Plains All American weakens as NGL divestiture and cost cuts frame muted 2026 growth first appeared on AlphaStreet News.
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