6) Energy Transfer LP (NYSE:ET)
Forward P/E Ratio as of 26 August: 10.27x
Share Price as of 26 August: $16.11
Number of Hedge Fund Holders: 32
Short % of Shares Outstanding (31 July 2024): 1.03%
Energy Transfer LP (NYSE:ET) owns a large platform of crude oil, natural gas, and natural gas liquid assets primarily in Texas and the US mid-continent region. The company has gathering and processing facilities, one of the largest fractionation facilities in the U.S., and fuel distribution.
The company is involved in all the aspects of midstream sector. It transports, stores, and processes various hydrocarbons throughout its systems. Therefore, the size and breadth of the systems provide several expansion project opportunities.
Energy Transfer LP (NYSE:ET) plans to capitalize on the early opportunities that it is seeing in power generation because of increased power needs from data centers due to the rise in artificial intelligence (AI). The company now expects its 2024 growth capital expenditures to be ~$3.1 billion. It benefits from a portfolio of assets having exceptional product and geographic diversity.
Energy Transfer LP (NYSE:ET) seems to be well-positioned to capitalize on the increasing natural gas power demand. Considering this growth opportunity, together with its strengthened balance sheet and consistent distribution growth, Energy Transfer LP (NYSE:ET) should see strong and stable growth over the upcoming years. Its well-diversified portfolio and solid execution track record should act as tailwinds. Dallas has been emerging as the key data center hub. Therefore, the company is likely to benefit from perhaps ~8 billion cubic feet per day of new data center demand, which is expected to take place by 2030.
Analysts at UBS Group increased their price target on shares of Energy Transfer LP (NYSE:ET) from $23.00 to $24.00, giving a “Buy” rating on 15th May. According to the Insider Monkey database, the number of hedge funds holding stakes in Energy Transfer LP (NYSE:ET) stood at 32 at the end of 2Q 2024.
Silver Beech Capital, a value-oriented investment management firm, released its 4Q 2023 investor letter. Here is what the fund said:
Energy Transfer LP (NYSE:ET) owns and operates the largest and most balanced collection of energy infrastructure assets in the United States. ET’s assets include 125,000 miles of oil and natural gas pipelines, export facilities on both the Gulf Coast and East Coast, and more than 1 million barrels per day of natural gas liquid fractionation capacity. ET accounts for 20% of worldwide natural gas liquid exports. Further, ET is uniquely connected to every major hydrocarbon basin in the United States.
By assembling energy infrastructure to gather, process, transport, and store hydrocarbons, ET connects exploration and production companies (“E&Ps”) with downstream end users such as gas stations, utilities, and export facilities. As an end-to-end midstream solution, ET enables its customers to focus on their portion of the value chain without the burden of significant but essential midstream logistics. ET’s services thus add tremendous value to all constituents of the energy marketplace.
Though natural gas is a relatively clean source of fuel, restrictive federal and state regulations and other permissions severely restrict the building of natural gas pipelines and other infrastructure in North America that would help facilitate abundant hydrocarbon production. Pipelines are by far the cheapest and greenest method of transporting hydrocarbons; pipelines reduce emissions from truck transport and reduce congestion on highways, rail, and shipping routes…” (Click here to read the full text)
