Street view: Lake Charles LNG suspension removes overhang on Energy Transfer stock

Pipeline operator Energy Transfer ET.N on Thursday said it was suspending the development of its Lake Charles liquefied natural gas export facility in Louisiana

ET also says it will increase transportation capacity of its Desert Southwest (DSW) mainline pipeline

Stock up 0.3% at $16.25 in thin premarket trading; down 17.3% YTD

SUSPENSION ALLOWS ET TO FOCUS ON NATGAS PROJECTS

UBS ("Buy"; PT: $22) says DSW expansion project is "high return" which could add incremental EBITDA of $870 million, adding "we believe suspending the Lake Charles LNG project does remove an overhang from the stock"

Jefferies ("Hold"; PT: $17) expects the economics of DSW to get stronger the closer ET gets to reaching 2.3 billion cubic feet per day of capacity

Adds if ET were to sell rights to Lake Charles LNG facility it could fetch at least ~$200 million

RBC Capital Markets ("Outperform"; PT: $22) says the suspension is positive as it allows ET to focus on its backlog of natural gas pipeline projects and that there is greater value in the DSW expansion project