JP Morgan downgrades Plains GP to Neutral, PT to $20 from $21.

JP Morgan downgrades Plains GP to Neutral, PT to $20 from $21.

September 12, 2025

In a recent move, JP Morgan has downgraded Plains GP Holdings, L.P. (NasdaqGS:PAGP) to Neutral, reducing its price target (PT) from $21 to $20. This decision follows a series of recent developments and financial performance reports from Plains All American Pipeline, L.P. (NasdaqGS:PAA), a subsidiary of Plains GP.

Plains GP operates through Plains All American Pipeline, which engages in the transportation, terminaling, storage, and gathering of crude oil and natural gas liquids (NGL) in the United States and Canada. The company has been subject to various financial risks and analyst expectations in recent quarters, with earnings and revenue growth being a significant concern.

The downgrade comes after a series of earnings misses and revenue expectations that have fallen short of analyst estimates. For instance, in the second quarter of 2025, Plains All American missed both EPS and revenue expectations, which has raised concerns about its ability to meet future growth targets. Additionally, the company has been facing elevated risk due to its high level of debt and large one-off items impacting financial results.

Despite these challenges, Plains GP continues to offer a high dividend yield, currently at 8.71%, which has been a draw for investors. However, the dividend is not well covered by earnings, adding to the financial risk profile of the stock.

JP Morgan's downgrade reflects the market's growing skepticism about Plains GP's ability to meet its growth targets and the increased risk associated with its financial position. The investment bank has noted that while the stock offers an attractive yield, the elevated risk and uncertainty surrounding the company's financial performance warrant a more cautious approach.

Investors should closely monitor the company's future earnings reports and any additional developments that could impact its financial health and growth prospects. As always, it is essential to conduct thorough research and consider consulting with a financial advisor before making investment decisions.