ET Intrinsic Stock Value – Energy Transfer LP Yields 9.25%, Offers Distribution Growth, and Is Undervalued
November 21, 2023
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Energy ($NYSE:ET) Transfer LP (ET) is an energy infrastructure MLP operating across the United States. ET owns and operates natural gas storage, gathering, and transmission assets and is one of the largest natural gas pipeline operators in the United States. Furthermore, ET’s recent distribution growth has been strong. ET’s low unit price and high yield make it an attractive option for income-focused investors.
Furthermore, its strong distribution growth gives investors long-term growth potential. Lastly, the fact that it is still undervalued compared to peers makes it an even more attractive option. All in all, ET offers investors a high yield, a long history of distribution growth, and the potential to benefit from additional upside due to its undervaluation.
Analysis – ET Intrinsic Stock Value
At GoodWhale, we conducted an in-depth analysis of the fundamentals of ENERGY TRANSFER LP. Our proprietary Valuation Line gave us a fair value of around $11.2 per share. However, the current market price of ENERGY TRANSFER LP is $13.6, which is overvalued by 21.5%. This indicates that investors are paying a premium for the stock. It may be wise for them to consider adjusting their portfolios accordingly. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for ET. More…
| Total Revenues | Net Income | Net Margin |
| 78.56k | 3.31k | 5.5% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for ET. More…
| Operations | Investing | Financing |
| 9.6k | -4.31k | -5.1k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for ET. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 107.57k | 66.51k | 10.53 |
Key Ratios Snapshot
Some of the financial key ratios for ET are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 22.6% | 8.7% | 10.1% |
| FCF Margin | ROE | ROA |
| 8.0% | 14.9% | 4.6% |
Peers
In the world of energy transportation, there is intense competition between Energy Transfer LP and its rivals Enterprise Products Partners LP, Kinder Morgan Inc, and Williams Companies Inc. All four of these companies are vying for a share of the market in order to provide the best possible service to their customers. While each company has its own strengths and weaknesses, they all recognize the importance of providing a reliable and efficient service.
– Enterprise Products Partners LP ($NYSE:EPD)
Enterprise Products Partners LP is one of the largest publicly traded partnerships and a leading North American provider of midstream energy services to producers and consumers of natural gas, NGLs, crude oil, refined products and petrochemicals. Our services include: natural gas gathering, processing, storage and transportation; NGL transportation, fractionation, storage and import and export terminals; crude oil transportation, storage and terminals; and petrochemical and refined products transportation, storage and terminals. We have a diversified portfolio of assets in North America that are strategically located to serve major producing basins and refining markets.
– Kinder Morgan Inc ($NYSE:KMI)
Kinder Morgan is one of the largest energy infrastructure companies in North America. They own or operate an oil and gas pipeline system that extends from Canada to the Gulf of Mexico. Kinder Morgan also owns and operates a number of Terminals, which are used to store and ship crude oil, refined petroleum products, and natural gas liquids. The company has a market cap of 39.61B as of 2022 and a Return on Equity of 7.82%.
– Williams Companies Inc ($NYSE:WMB)
The Williams Companies, Inc. is an American energy company headquartered in Tulsa, Oklahoma. It is one of the largest natural gas companies in the United States. The company’s business activities include natural gas pipeline transportation and storage, gathering and processing, and petrochemical production.
The Williams Companies has a market capitalization of $36.51 billion as of 2022. The company’s return on equity is 17.09%. The company is engaged in natural gas pipeline transportation and storage, gathering and processing, and petrochemical production.
Summary
Energy Transfer LP (ET) is an attractive investment opportunity for those seeking a high yield, consistent distribution growth, and an undervalued stock. ET offers investors a great combination of high yield, consistent distribution growth, and value.
