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Energy Transfer (ET) has experienced a 13% decline in its stock price year-to-date, yet maintains a highly competitive dividend yield, positioning it as an attractive consideration for passive income investors. The company is strategically investing $5 billion in growth projects in 2025, primarily in natural gas and NGL infrastructure, to secure long-term cash flow and sustain its robust dividend payouts. Market Overview: Energy Transfer Faces Headwinds While Sustaining High Yield Energy Transfer LP (NYSE: ET), a prominent midstream energy company, has seen its stock decline by approximately 13% year-to-date through September 9, 2025. This performance contrasts with the broader market, as the S&P 500 has recorded a 10% gain over the same period. Despite this underperformance, Energy Transfer continues to offer a compelling distribution yield exceeding 7.5%, significantly higher than the S&P 500 average of approximately 1.2%. Recent Financial Performance and Operational Highlights For the second quarter of 2025, Energy Transfer reported distributable cash flow (DCF) attributable to partners of $1.96 billion, a slight decrease from $2.04 billion in the second quarter of 2024. Net income attributable to partners also saw a modest decline, reaching $1.16 billion compared to $1.31 billion in the prior year period, resulting in basic net income per common unit of $0.32. However, Adjusted EBITDA for the quarter rose to $3.87 billion, an increase from $3.76 billion in Q2 2024. Operationally, Energy Transfer demonstrated robust volume growth across all segments in Q2 2025. Interstate natural gas transportation volumes advanced by 11% year-over-year, while midstream gathered volumes increased by 10%, setting a new company record. Crude oil transportation volumes also reached a new record, rising 9%, and NGL transportation volumes grew by 4%, another record for the partnership. The company announced an increase in its quarterly cash distribution to $0.33 per unit (or $1.32 annualized), representing a more than 3% increase compared to the second quarter of 2024. Analysis of Market Reaction and Underlying Factors The year-to-date decline in Energy Transfer's unit price can be attributed to a confluence of factors, including a slowdown in its growth rate for 2025. The company now anticipates its adjusted EBITDA to be at or slightly below the lower end of its previously projected $16.1 billion to $16.5 billion guidance range, implying a growth rate of less than 4% for the year. This deceleration contrasts sharply with 2024, when the company achieved a 13% increase in adjusted EBITDA and a 10% rise in distributable cash flow, partly fueled by acquisitions like Crestwood Equity Partners and WTG Midstream. Cooling energy market conditions and lower oil prices have also exerted downward pressure on the stock. Unlike the previous year, Energy Transfer has not completed significant acquisitions in 2025, and only a few smaller organic expansion projects have been finalized. Despite the recent stock performance, the high dividend yield makes Energy Transfer particularly appealing to passive income investors. The company's business model is characterized by resilience, with approximately 90% of its expected 2025 Adjusted EBITDA derived from fee-based agreements. This structure significantly limits exposure to commodity price volatility, ensuring more stable and predictable cash flows. Strategic Investments and Future Outlook Energy Transfer is executing an aggressive growth strategy, earmarking approximately $5 billion for capital expenditures in 2025. A substantial portion, nearly half, of this investment is directed towards natural gas infrastructure. Key projects include Permian Basin expansions, the Transwestern Pipeline Expansion, and other NGL infrastructure initiatives. The Transwestern Pipeline Expansion, a multi-phase project with a total capital cost of approximately $2.7 billion, aims to add 1.5 Bcf/d capacity by Q4 2026, addressing growing demand in the Southwest U.S. Management has also indicated plans to increase the annual payout by 3% to 5% in the coming years. The company's financial position is robust, with its leverage ratio currently in the lower half of its target range of 4 to 4.5 times, marking its strongest financial position in history. This strong balance sheet and ample liquidity, including $2.51 billion of available borrowing capacity on its revolving credit facility, provide flexibility for future growth and potential acquisitions. Looking ahead, catalysts for a potential recovery in Energy Transfer's unit price include the anticipated reacceleration of growth in 2026 and 2027 as current capital projects become operational. The company also retains the capacity and strategic interest in pursuing further significant acquisitions, which could provide additional momentum. The consistent demand from power generation and industrial sectors, alongside emerging long-term opportunities from data center gas demand, underpins the strategic rationale behind its natural gas infrastructure investments.
Financial commentator Jim Cramer has publicly endorsed Energy Transfer LP (NYSE:ET) as a "sensational" natural gas play, drawing renewed investor attention to the company despite its recent stock stagnation. This report delves into the implications of this endorsement, the company's underlying fundamentals, strategic growth initiatives, and the broader market context for the midstream energy giant. Energy Transfer LP (NYSE:ET) has recently come under increased investor scrutiny following a public endorsement by financial commentator Jim Cramer, who characterized the natural gas pipeline operator as a "sensational" play. This renewed attention arrives as the company's stock has largely remained range-bound, prompting questions about its underlying value and future trajectory. The Event in Detail During a recent broadcast, a caller highlighted the apparent stagnation of ET shares, which have traded consistently around the $17 level, despite what was described as robust fundamental value. Cramer concurred with this assessment, stating, > "It's a premier natural gas play, pipeline. I think it's sensational." He further emphasized the potential benefits for ET from a projected increase in European imports of U.S. liquified natural gas (LNG). Energy Transfer LP commands a vast energy infrastructure network across the United States, encompassing approximately 140,000 miles of pipeline and substantial storage and processing capabilities. This includes gathering, compression, treating, storage, transportation, and marketing services for natural gas, natural gas liquids, and crude oil, spanning 44 states. Analysis of Market Reaction The endorsement from a high-profile figure like Jim Cramer often correlates with a short-term uptick in retail investor interest and trading volume for the highlighted stock. Historically, studies have indicated that Cramer's recommendations can lead to an average risk-adjusted one-day return of 0.46%, suggesting an immediate market reaction. However, the long-term impact on ET will hinge on whether the fundamental value Cramer identifies, coupled with the anticipated demand for LNG, can translate into sustained growth and overcome the stock's recent performance plateau. While ET shares have roughly tripled over the past five years, a more recent period of stagnation around the $17 mark has been noted. The market sentiment is cautiously bullish, anticipating potential volatility as retail interest may drive short-term price movements. Broader Context & Implications Energy Transfer LP operates in a competitive midstream energy sector alongside peers such as Enterprise Products Partners L.P. (EPD) and Kinder Morgan (KMI). ET exhibits an EV/EBITDA ratio of 9.15X to 9.29X, which is below the industry average of approximately 10.65X, potentially indicating a relative undervaluation compared to its sector. The company's attractive 7.5% dividend yield (or $0.33 per common unit quarterly, totaling $1.32 annualized) stands out for income-oriented investors, though its payout ratio of 102.33% suggests it is currently distributing more than its earnings. ET's net leverage ratio for 2025 is estimated at 3.76, and its trailing 12-month return on equity is 11.08%. The company's recent financial performance for the second quarter of 2025 reported net income attributable to partners of $1.16 billion, a decline from $1.31 billion in the same period of 2024. However, Adjusted EBITDA saw a slight increase to $3.87 billion from $3.76 billion year-over-year. Revenue for Q2 2025 experienced a 7.17% year-over-year decline. Growth capital expenditures were significant at $1.04 billion in Q2 2025. Strategic growth initiatives are central to ET's future. The company secured a deadline extension for its Lake Charles LNG project, allowing exports of up to 2.33 billion cubic feet per day by December 2031. This project is bolstered by recent Sale and Purchase Agreements (SPAs), including an incremental 1.0 million tonnes per annum (mtpa) deal with Chevron U.S.A. Inc. and a 1.0 mtpa agreement with Kyushu Electric Power Company. Other notable expansions include a $5.3 billion expansion of its Transwestern Pipeline (expected Q4 2029) and the construction of a new storage cavern at its Bethel facility to double natural gas working storage capacity to over 12 Bcf. The company also recently placed several processing plants and NGL export expansions into service. As of September 2025, Energy Transfer LP was held by 36 hedge funds, indicating institutional interest. Expert Commentary Jim Cramer's assertion that Energy Transfer LP is "one of the largest players in the space" with "huge benefits" from European LNG imports underscores a key investment thesis. He highlighted the company's robust dividend as a benefit for investors "while you wait for the potential EU trade benefit to kick in." While Cramer's endorsements carry weight, it is pertinent to note that analysts forecast a potential upside of 29.50% for ET, with an average target price of $22.68. Conversely, some valuation models, such as GuruFocus' GF Value, estimate a downside risk of 12.79% based on a fair value of $15.27 within the next year, reflecting the inherent complexities and varied perspectives on valuation within the midstream sector. Looking Ahead The future performance of Energy Transfer LP is likely to be influenced by global energy demand, particularly the escalating need for natural gas to fuel artificial intelligence data centers and bolster European energy security through LNG exports. The company's substantial portfolio of ongoing and recently completed infrastructure projects, including the Lake Charles LNG project and various pipeline and processing plant expansions, positions it to capitalize on these trends. Investors will monitor the execution and timelines of these capital-intensive projects, which carry potential risks of cost overruns. While ET's fee-based contracts, accounting for approximately 90% of its EBITDA, provide a degree of revenue stability, the market will closely watch global natural gas price dynamics and any shifts in regulatory or geopolitical landscapes that could impact its expansive operations and long-term dividend sustainability. The company's management projects Adjusted EBITDA for FY2025 to be at or slightly below the lower end of the $16.1 billion to $16.5 billion range.
Energy Transfer LP is strategically expanding its natural gas processing capacity across key U.S. production basins to capitalize on increasing hydrocarbon volumes and reinforce its competitive standing in the midstream energy sector. This move comes as broader market sentiment for the midstream segment remains positive, driven by growing demand for natural gas. Energy Transfer Bolsters Natural Gas Processing Capabilities Energy Transfer LP (ET) is significantly bolstering its natural gas processing capabilities across key U.S. production basins, a strategic move poised to capitalize on increasing hydrocarbon volumes and reinforce its competitive standing in the midstream energy sector. The company's proactive expansion efforts come as broader market sentiment for the midstream segment remains positive, driven by growing demand for natural gas. Strategic Capacity Additions in Key Basins Energy Transfer has announced substantial additions to its natural gas processing capacity. The company plans to add 50 million cubic feet per day (MMcf/d) of capacity at each of four distinct Permian Basin processing plants, culminating in an incremental 200 MMcf/d. Concurrently, the Mustang Draw project is set to provide an additional 275 MMcf/d of processing capacity within the Midland Basin, with an expected in-service date in the first half of 2026. These expansions build upon Energy Transfer's already extensive infrastructure, which includes a total processing capacity of approximately 12.9 billion cubic feet per day (Bcf/d), with nearly 4.9 Bcf/d currently situated in the Permian Basin. This strategic development aims to enhance the company's ability to manage greater throughput of natural gas and natural gas liquids (NGLs), thereby solidifying its critical role between producers and end markets. Market Response and Valuation Insights The market has responded positively to Energy Transfer's strategic maneuvers. Units of ET have advanced 8.4% over the past year, significantly outperforming the broader Zacks Oil and Gas - Production Pipeline - MLB industry, which experienced a decline of 0.7% over the same period. This outperformance and the strategic expansion signal investor confidence in ET's growth trajectory and its ability to secure stable cash flows through enhanced network utilization. From a valuation standpoint, Energy Transfer appears to be trading at a discount relative to its peers. The company's trailing 12-month Enterprise Value to Earnings Before Interest, Taxes, Depreciation, and Amortization (EV/EBITDA) stands at approximately 9.31X, notably below the industry average of 10.65X. This valuation metric suggests that ET's units may be currently undervalued, presenting an attractive proposition for investors seeking exposure to the midstream sector's growth. Broader Context and Financial Implications Energy Transfer's expansion strategy is deeply rooted in the surging demand for natural gas, particularly from power-hungry regions like Texas and the Southwestern U.S., as well as the growing needs of data centers driven by artificial intelligence (AI). The company is also positioning its infrastructure to support the Lake Charles LNG export facility project. This proactive approach addresses critical infrastructure bottlenecks in key production regions like the Permian Basin, ensuring that growing volumes of natural gas can be efficiently transported and processed. The company's robust business model is underscored by approximately 90% of its EBITDA being derived from fee-based operations, providing a shield against the volatility of commodity prices and contributing to predictable cash flows. Recent strategic acquisitions, including WTG Midstream, Lotus Midstream, and Crestwood Equity Partners, have further strengthened ET's natural gas and NGL network and expanded its operational footprint across the Permian, Williston, and Haynesville basins. Analyst consensus estimates project strong earnings growth for Energy Transfer, with year-over-year earnings per unit expected to rise by 8.59% in 2025 and 10.91% in 2026. The company maintains a consistent track record of returning value to unitholders, having raised its distribution rates 16 times over the past five years, with a current quarterly cash distribution of 33 cents per common unit. Management targets an annual distribution growth of 3% to 5% moving forward. While its trailing 12-month return on equity (ROE) of 11.08% lags the industry average of 13.65%, its consistent distributions and strategic growth initiatives underpin a compelling long-term investment case. Outlook: Sustained Growth and Strategic Positioning As Energy Transfer continues its aggressive capital expenditure program, allocating an estimated $5 billion for full-year infrastructure development, investors will be closely monitoring the execution of these expansion projects and their impact on throughput volumes and financial performance. The ongoing growth in demand for natural gas, fueled by power generation needs, LNG exports, and emerging sectors like AI, will remain a critical driver for ET's future prospects. The company’s ability to maintain its leverage within targeted ranges (debt-to-EBITDA between 4-4.5/1) while funding significant growth capital expenditures will also be a key area of focus. With its expanded capacity and strategic positioning, Energy Transfer appears well-placed to capture enduring growth opportunities in the evolving energy landscape.
Four prominent master limited partnerships (MLPs) in the pipeline sector—Energy Transfer, Enterprise Products Partners, Western Midstream, and MPLX—are actively pursuing significant growth projects and strategic mergers and acquisitions. These initiatives are designed to enhance long-term income generation, solidify market positions, and maintain attractive yields for investors amidst evolving energy market dynamics. Opening: Midstream MLPs Signal Robust Growth Through Capital Deployment U.S. midstream master limited partnerships (MLPs) are demonstrating a commitment to growth and shareholder returns through substantial capital expenditures and strategic acquisitions. Leading entities such as Energy Transfer (ET), Enterprise Products Partners (EPD), Western Midstream (WES), and MPLX (MPLX) are directing significant capital toward expanding infrastructure and optimizing asset portfolios, signaling a bullish outlook for the sector's income-generating capabilities. The Event in Detail: Strategic Expansion Across Key Players Individual companies within the midstream sector have outlined ambitious plans to bolster their operations and market presence: Energy Transfer (ET): The company is earmarking approximately $5 billion for expansion projects this year, a notable increase from $3 billion previously. These investments are concentrated on meeting natural gas demand in critical regions like Texas and the Southwestern U.S., advancing its liquefied natural gas (LNG) initiatives, and positioning its natural gas pipeline system to supply the burgeoning data center market driven by artificial intelligence expansion. Energy Transfer has a track record of shareholder distributions, having increased its payout for 15 consecutive quarters, with management projecting a continued annual distribution growth of 3% to 5%. Approximately 90% of its EBITDA stems from fee-based operations, providing revenue stability. Enterprise Products Partners (EPD): This MLP has significantly increased its growth capital expenditures to over $4 billion for the current year. The company maintains a conservative financial posture, evidenced by a strong balance sheet with leverage just above 3x and long-term debt secured at favorable rates. Enterprise Products Partners has an impressive record of 27 consecutive years of distribution increases. Its business model is largely fee-based, with around 80% of operations backed by take-or-pay agreements that include inflation adjustments. The company has consistently achieved returns on invested capital (ROIC) around 13%. Western Midstream (WES): Offering a 9.6% yield, among the highest in this group, Western Midstream benefits from predictable cash flows due to strong contractual agreements and its close affiliation with parent company Occidental Petroleum (OXY), which holds over 40% ownership. The company is expanding into new growth avenues, particularly in produced water management, with the construction of its Pathfinder system. Notably, Western Midstream recently acquired Aris Water Solutions for $2 billion, a move that establishes it as the second-largest water midstream operator in the Permian Basin, adding significant water-handling capacity and diversifying revenue through long-term contracts. The acquisition is projected to generate $40 million in annualized cost synergies and is valued at 7.5x its 2026 EBITDA. MPLX (MPLX): The company recently completed the $2.375 billion acquisition of Northwind Midstream, which is set to enhance its Permian natural gas and NGL value chains and is immediately accretive to distributable cash flow. In a strategic move to sharpen its focus on the Permian Basin, MPLX also agreed to divest its Rockies gathering and processing assets for $1 billion in cash. This divestment, which saw the company's stock price rise 4.8% pre-market, aligns with a broader strategy of portfolio optimization. MPLX has significantly boosted its growth capital expenditure to $1.7 billion for 2025, with 85% allocated to its Natural Gas and NGL Services segment, targeting expansion from the Permian Basin to the Gulf Coast. The company reported a record adjusted EBITDA of $1.8 billion for Q1 2025 and maintains a strong distribution coverage ratio of 1.5x, anticipating a 12.5% annual distribution growth over the coming years. Analysis of Market Reaction: Drivers of Midstream Optimism The proactive capital deployment and strategic M&A activities within these midstream MLPs are fueling positive market sentiment. The focus on fee-based operations, high distribution yields, and significant infrastructure expansion projects provides a stable revenue outlook less susceptible to commodity price volatility. Investors are reacting positively to the clear strategies for long-term growth in distributable cash flow and the enhancement of asset portfolios. For instance, the Northwind Midstream acquisition by MPLX and the Aris Water Solutions deal by Western Midstream are expected to be immediately accretive or generate substantial synergies, underpinning future financial stability and growth. Broader Context & Implications: A Shift Towards Core Competencies The strategic maneuvers by these MLPs reflect a broader trend within the midstream energy sector: a concerted effort to optimize portfolios and concentrate on core, high-growth basins with robust takeaway capacity to export markets. MPLX's "wellhead-to-water" strategy, for example, aims to link NGLs from prolific basins like the Permian and Marcellus to international demand via the Gulf Coast, capitalizing on increasing global demand for natural gas and NGLs. By divesting less utilized assets, as seen with MPLX's Rockies sale, companies are redeploying capital into higher-return, more strategic projects, thereby enhancing competitive advantages and operational efficiencies. These actions are not merely about expansion but also about strengthening financial resilience. Energy Transfer's focus on reducing leverage and enhancing its contract portfolio, and Enterprise Products Partners' conservative financial approach, underscore a commitment to balance sheet health alongside growth. The substantial capital investments, such as Energy Transfer's $5 billion in projects and MPLX's $1.7 billion growth capex, are projected to yield mid-teen returns, further solidifying the financial cases for these companies. Expert Commentary: Positive Outlook with Valuation Nuances Analysts generally hold a positive view on the midstream sector's outlook, particularly for companies demonstrating strategic growth and strong financial management. For MPLX, analyst sentiment is largely positive, with an average one-year price target suggesting an 11.77% upside from its trading price as of August 27, 2025. However, some valuation models, such as GuruFocus' GF Value, indicate a potential downside, highlighting the differing perspectives on future growth and current pricing. Looking Ahead: Sustained Yields and Market Position The concerted efforts of Energy Transfer, Enterprise Products Partners, Western Midstream, and MPLX in strategic capital deployment and portfolio optimization are poised to drive long-term revenue growth and enhance distributable cash flow. Investors will be closely watching the execution of these large-scale projects, particularly the realization of projected synergies from recent M&A activities and the ability to maintain strong distribution coverage ratios. The continued focus on connecting domestic energy production to global markets, coupled with prudent financial management, suggests that these MLPs are strategically positioned for sustained high yields and potential capital appreciation in the evolving energy landscape. Key factors to monitor include global energy demand trends, the progress of key infrastructure projects, and ongoing efforts to strengthen balance sheets.
The P/E ratio of Energy Transfer LP is 12.229
The current price of ET is 17.58, it has decreased 0% in the last trading day.
Energy Transfer LP belongs to Energy industry and the sector is Energy
Energy Transfer LP's current market cap is $60.3
According to wall street analysts, 22 analysts have made analyst ratings for Energy Transfer LP, including 11 strong buy, 13 buy, 2 hold, 0 sell, and 11 strong sell
Moving? Bro, it's down 0.23%[^0^]. That's less movement than my portfolio on a Sunday. Energy Transfer (ET) is currently trading sideways, caught between a wave of bullish sentiment from news and analysts, and a neutral-to-bearish technical picture. The stock is coiling, and the real move hasn't happened yet.
Here’s the alpha on why ET is stuck in place but could be setting up for a bigger move:
The Technicals Are Snoozing: On the daily chart, ET is in a clear consolidation phase. The price is currently trading below its 50-day MA ($17.56) and 200-day MA ($18.30), which is a bearish signal for trend followers[^0^]. The daily RSI is hovering around 48, the definition of neutral, and the ADX indicator is at a low 11.86, confirming there's no real trend to speak of right now[^0^]. The stock is basically trapped between support at $16.38 and a key resistance level at $17.76[^0^].
Wall of Bullish News & Analyst Hype: While the chart is boring, the narrative is anything but. Over the past week, there has been a flood of bullish articles highlighting ET as deeply undervalued, a high-yield (7.5%+) play, and a prime beneficiary of the growing energy demand from AI data centers[^0^]. Analysts are all-in, with a "STRONG_BUY" consensus from 21 analysts who have a mean price target of nearly $23—that's over 30% upside from here[^0^].
"Smart Money" Is Watching: Even politicians are in on the action. Congressional trading data shows Rep. Virginia Foxx has been actively trading ET throughout the year[^0^]. While her most recent moves in June were sales, the consistent activity shows that even Washington is paying attention.
Actionable Alpha:
The play here isn't to guess the direction today; it's to wait for confirmation. The market is digesting a ton of bullish fundamental news while the price chart remains weak.
Basically, it's a coiled spring of bullish news and meh technicals. Stop staring at the 1-minute chart and set an alert on Edgen Radar for a break of those key levels. Then you can tell everyone you knew it was coming.