8. Energy Transfer L.P. (NYSE:ET)
Number of Hedge Fund Investors: 32
Energy Transfer L.P. (NYSE:ET) manages a diverse range of midstream assets, such as pipelines, storage facilities, and terminals. This extensive network allows Energy Transfer L.P. (NYSE:ET) to capitalize on the rising demand for natural gas and liquefied natural gas (LNG), both in the U.S. and globally.
As the energy market moves toward cleaner fuels, Energy Transfer L.P. (NYSE:ET)’s infrastructure plays a crucial role in this shift. Additionally, Energy Transfer L.P. (NYSE:ET) has a strong track record of paying attractive dividends.
Analyst Steven Fiorillo notes that Energy Transfer L.P. (NYSE:ET) may still be undervalued, presenting a buying opportunity. He expects Energy Transfer L.P. (NYSE:ET), which has been trading within a certain range, could rise above $16.50 and approach $20 by the end of 2024. Fiorillo also highlights that the growth in AI and the associated need for new data center infrastructure could indirectly benefit Energy Transfer L.P. (NYSE:ET), making it a valuable investment linked to the AI boom.
Tom Long, the Co-CEO of Energy Transfer L.P. (NYSE:ET), shared the following during their latest earnings call:
“We had record volumes through our crude oil and NGL pipelines, as well as record NGL exports. We also saw strong performance from our NGL fractionators and our refined products pipelines and terminals. DCF a trivial to the partners of Energy Transfer as adjusted was $2 billion compared to $1.6 billion for the second quarter of 2023. And for the six months of 2024, we spent approximately $1 billion on organic growth capital, primarily in the midstream and NGL and Refined Products segments, excluding SUN and USA compression CapEx. Now turning to our results by segment for the second quarter and let’s start with NGL and Refined Products. Adjusted EBITDA was $1.07 billion, compared to $837 million for the second quarter of 2023. The increase was primarily due to growth across our transportation, fractionation and terminal operations including records in both Mariner East and Permian Pipeline volumes, as well as NGL exports.
In addition, we had higher gains from the optimization of hedged NGL inventory. For Midstream, adjusted EBITDA was $693 million, compared to $579 million for the second quarter of 2023. The increase was primarily due to the addition of the Crestwood assets as well as higher volumes in the Permian Basin. For our Crude Oil segment, adjusted EBITDA was $801 million compared to $674 million for the second quarter of 2023. The increase was primarily due to record crude oil transportation throughput. And increase in our total crude oil exports, which were up 11% as well as the acquisitions of the Lotus and Crestwood assets in May and November of 2023 respectively. Excluding these acquisitions, adjusted EBITDA and Crude Oil transportation volumes on our base business increased 4% and 8% respectively.
In our Interstate segment, adjusted EBA was $392 million compared to $441 million the second quarter of 2023. During the quarter, we saw higher contracted volumes on Trunk Line, Pebble, Gulf Run & MRT. This was offset by lower operational gas sales, maintenance project cost of $12 million, as well as a $35 million reduction in revenue for shipper refunds related to our Pebble rate case. For the Intrastate segment, adjusted EBITDA was $328 million, compared to $216 million in the second quarter of last year. The increase was primarily due to approximately $75 million of an increased gains related to pipeline optimization opportunities, as well as favorable storage optimization opportunities. “
