ET - Energy Transfer: An 8.66% Yield And Upside Potential
2024-02-20 09:00:00 ET
Summary
- Energy Transfer has seen significant growth and increased its distribution, making it a successful investment in the oil patch.
- The company faces risks such as government regulation and advancements in renewable energy, but its strong infrastructure and operations position it for continued growth.
- Compared to its peers, Energy Transfer is undervalued and has the potential for further appreciation, with a fair value range of $16.95 to $22.89 per unit.
Sometimes, all you need when it comes to investing is capital, conviction, and time. Investing in the oil patch hasn't been popular as the AI revolution fuels a bull market in the technology sector while an emphasis on renewables continues to increase. A common theme across many of my articles has been that the global economy is heavily dependent on oil and gas, and it will be increasingly difficult to reduce our dependence on traditional sources of energy. As the global population increases and more families increase their standard of living, the global demand for energy will continue to grow. The oil and gas sector isn't just tied to internal combustion engines as their primary inputs throughout the manufacturing process, a building block for fertilizers and the foundation for petrochemicals and plastics. As the global population increases, the chances are that additional energy output will be needed from all sources, and we will remain dependent on oil and gas. Investing in the oil patch isn't for the faint of heart, but investors who have been investing in Energy Transfer ( ET ) over the past several years have a lot to celebrate. After more than three years, the distribution is finally larger than it was before the reduction. ET has grown into one of the largest midstream operators in North America, with more than 125,000 miles of pipeline in 44 states. While units of Energy Transfer continue to rally, I think there is still value to be unlocked, and I see shares continuing to appreciate throughout 2024....
Energy Transfer: An 8.66% Yield And Upside Potential