- Energy equities retreated from their relative highs in June as the Delta variant spread, the value trade sputtered, and oil prices weakened following the OPEC+ announcement in July.
- While midstream sold off with oil and energy stocks, the fundamental picture for midstream improved in many respects as reflected by positive estimate revisions coming out of 2Q21 earnings season.
- The outlook for midstream remains constructive, with a compelling investment case driven by attractive yields, discounted valuations, growing free cash flow, and buyback potential. That said, some challenges persist for energy equities broadly.
For further details see:
Midstream/MLPs: Summer Sell-Off Feels Overdone