The Zacks Analyst Blog Highlights: Royal Dutch Shell, Kinder Morgan, El Paso Pipeline Partners, Total SA and Omnicell

Jan 30, 2013, 09:30 ET from Zacks Investment Research, Inc.

CHICAGO, Jan. 30, 2013 /PRNewswire/ -- announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Royal Dutch Shell plc (NYSE: RDS.A), Kinder Morgan Inc (NYSE: KMI), El Paso Pipeline Partners, L.P. (NYSE: EPB), Total SA (NYSE: TOT) and Omnicell Inc. (Nasdaq: OMCL).


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Here are highlights from Tuesday's Analyst Blog:

Shell to Export LNG Jointly

Shell US Gas & Power LLC – a subsidiary of Royal Dutch Shell plc (NYSE: RDS.A) – Southern Liquefaction Company, LLC – subsidiary of Kinder Morgan Inc (NYSE: KMI) – and a unit of El Paso Pipeline Partners, L.P. (NYSE: EPB) announced their plan to jointly form a limited liability company. The new entity will develop an export-ready natural gas liquefaction plant at a shipping terminal near Savannah, Georgia.

Upon corporate and regulatory approvals, the newly formed company will use El Paso's existing pipeline and terminal infrastructure to modify its Elba Express Pipeline and Elba Island LNG Terminal. The developed facility will export liquefied natural gas (LNG) by ship. A small-scale liquefaction unit of Shell will be included with the existing Elba Island facility to facilitate speedy construction.

Per the deal, Kinder Morgan owned El Paso will have a 51% stake in the new company and operate the facility.  Shell will have the remaining 49% stake and 100% of the liquefaction capacity. It is estimated that the facility will have a capacity of 2.5 million tons per year upon completion.

The Free Trade Agreement approval has been sanctioned to the project and the non-Free Trade Agreement approval is also expected soon. Management at Shell believes that this deal will meet the world's growing energy requirement and boost the U.S. economy.

In terms of assets, Royal Dutch Shell owns a strong and diversified portfolio of global energy businesses that offer attractive long-term growth opportunities. The group's strong inventory of development projects and increased capital expenditures should help volume growth in the long run.

However, Royal Dutch Shell conducts operations in many countries. As such, the group is exposed to risks associated with doing business abroad. Such risks include embargoes and/or expropriation of assets, exchange rate risks, terrorism and political/civil sentiment.

Royal Dutch Shell currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months. Another oil company Total SA (NYSE: TOT) having a Zacks Rank #2 (Buy) is also expected to perform in line with the market.

Omnicell Gains Foothold in Qatar

Omnicell Inc. (Nasdaq: OMCL), provider of end-to-end automation solutions for medication-use process, continues to expand its client base. The company along with its partner Mannai Corporation has been selected as the exclusive provider of automated medication management solutions throughout the Sidra Medical and Research Center in Doha, Qatar.

Sidra Medical and Research Center, which is currently under construction, will be focusing on woman and child health on a regional and global basis. This center will be a complete digital facility with 400 beds at the beginning with an expansion plan of up to 550 beds at a later phase. To support its all-digital facility, Sidra will deploy Omnicell's G4 platform.

The decentralized pharmacy model of the company's G4 platform is expected to enhance nursing workflow and standards of patient care at Sidra. Considering that the company's offerings were selected after a worldwide competitive review of medication automation technology, selection of Omnicell implies a clear competitive edge over other players.

In a concerted effort to offer unparalleled medical facilities, Sidra plans to standardize its management solutions by implementing other offerings from Omnicell to better manage its hospital. These include the Anesthesia Workstation, the Savvy mobile medication workstation and the Anywhere RN remote medication management system.

Our Take

Omnicell has already established its presence in the Middle East. Last year, the company inked an agreement with King Faisal Specialist Hospital and Research Center, Riyadh (accredited by The Joint Commission International) to replace all of its operating systems with the company's Anesthesia Workstations. The latest deal will expand Omnicell's foothold in the Middle East market.

This is well-aligned with the company's long-running goal of driving growth through expansion in international markets. Given that the overseas market is less than 1% penetrated, increasing awareness of automation benefits and higher investment in information technology by healthcare providers should provide incremental revenue opportunities for Omnicell.

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