ET Stock Outperforms its Industry in a Month: Time to Buy or Hold?
Units of Energy Transfer LP ET have rallied 6% in the last month compared with the Zacks Oil and Gas - Production Pipeline - MLB industry's growth of 3.4%. The oil and gas midstream firm owns a wide network of pipelines across the United States and is pursuing opportunities to serve the growing power loads from new demand centers across its network.
The firm is also a top exporter of liquefied petroleum gas and is working to expand natural gas liquids (NGL) export facilities to cater to the rising demand for NGL globally.
The ET stock has also outperformed its sector in the last month.
Price Performance (One Month)
Should you consider adding ET to your portfolio only based on positive price movements? Let's delve deeper and find out the factors that can help investors decide whether it is a good entry point to add ET stock to their portfolio.
Factors Acting as a Tailwind for ET Stock
Energy Transfer LP operates a vast pipeline network exceeding 130,000 miles across 44 U.S. states. The company continues to expand its reach through a combination of strategic acquisitions and organic growth initiatives. Since 2021, Energy Transfer has completed at least one major accretive acquisition each year, including the acquisition of WTG in the previous year, which strengthened its natural gas pipeline and processing capabilities in the Permian Basin.
Energy Transfer's assets are strategically located across major U.S. production basins and high-demand regions, providing a solid foundation for earnings. Its diversified portfolio — including oil and gas pipelines, gathering and processing systems, and storage facilities — enables the company to efficiently serve a wide array of markets.
The company also has substantial export capabilities, with the capacity to export over 1.1 million barrels per day of NGLs and 1.9 million barrels per day of crude oil. Ongoing expansion efforts at the Marcus Hook and Nederland terminals are enhancing these capabilities. Notably, Energy Transfer holds an estimated 20% share of the global NGL export market, reinforcing its strong presence in international energy trade.
Energy Transfer is actively exploring opportunities to meet the rising power demand from emerging load centers along its pipeline network. The company has finalized multiple agreements with electric utilities in the Midwest to supply natural gas for new gas-fired power plants that are replacing retiring coal-fired facilities. In February 2025, Energy Transfer entered into an agreement with CloudBurst to deliver up to 450,000 MMBtu per day of natural gas to support a data center development in Central Texas. Additionally, the company has received connection requests from nearly 200 data centers across 14 states, reflecting strong and growing demand from the digital infrastructure sector.
Nearly 90% of Energy Transfer's revenues are derived from fee-based contracts tied to transportation and storage services. These long-term agreements with a stable and creditworthy customer base provide reliable cash flow and significantly reduce exposure to commodity price volatility. With oil and gas production on the rise in the United States, the company is well-positioned to capitalize on the increasing demand for transportation infrastructure.
ET Shares More With Unitholders
Energy Transfer's current quarterly cash distribution rate is 32.75 cents per Energy Transfer common unit. ET's management has raised distribution rates 14 times in the past five years, and the current payout ratio is 98%.
ET's Estimates Moving North
The Zacks Consensus Estimate for Energy Transfer's 2025 and 2026 earnings per unit indicates year-over-year growth of 12.5% and 0.49%, respectively.
Another firm, Plains All American Pipeline PAA, operating in the midstream space, has extensive assets in the United States. The Zacks Consensus Estimate for Plains All American's 2025 and 2026 earnings per unit indicates a year-over-year decline of 1.32% in 2025 and 0.34% growth in 2026.
ET's Units are Trading at a Discount
Energy Transfer units are somewhat inexpensive relative to the industry. ET's current trailing 12-month Enterprise Value/Earnings before Interest, Tax, Depreciation and Amortization (EV/EBITDA) is 10.32X compared with the industry average of 11.6X. This indicates that the firm is presently undervalued compared with its industry.
Firms operating in this space, like ONEOK Inc. OKE, are trading at an EV/EBITDA of 13.39X, at a premium compared with its industry, while Plains All American Pipeline is trading at a discount of 9.46X.
ET Stock Returns Lower Than its Industry
Energy Transfer's trailing 12-month return on equity is 11.47%, lower than the industry average of 13.95%. Return on equity, a profitability measure, reflects how effectively a company utilizes its shareholders' funds to generate income.
ONEOK's ROE is better than its industry ROE and currently stands at 15.58%
Wrapping Up
Entergy Transfer, with more than 130,000 miles of pipeline and related infrastructure in 44 states, is poised well to benefit from the improving oil, natural gas and natural gas liquid production volumes in the United States. The firm is presently trading at a discount, and those who have this Zacks Rank #3 (Hold) stock in their portfolio can stay invested and enjoy the regular cash distribution.
Yet, as the firm's ROE is lower than the industry, it will be better for the investors to wait a little longer and find a better entry point.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.
Plains All American Pipeline, L.P. (PAA): Free Stock Analysis Report
ONEOK, Inc. (OKE): Free Stock Analysis Report
Energy Transfer LP (ET): Free Stock Analysis Report
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Province
19 minutes ago
- The Province
Another delivery system disruption as DHL Express Canada locks out workers and union strikes
Unifor says 2,100 truck drivers, couriers and warehouse workers across seven provinces went on strike at 11 a.m. ET Sunday morning Published Jun 08, 2025 • Last updated 5 hours ago • 2 minute read A DHL delivery truck passes a company facility Oct. 20, 2020, in New York. Photo by Frank Franklin II / AP A strike and lockout that kicked off at DHL Canada Express on Sunday will barely tap the brakes on its parcel delivery service, the company says, as the union accuses it of deploying replacement workers. This advertisement has not loaded yet, but your article continues below. THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY Subscribe now to read the latest news in your city and across Canada. Exclusive articles by top sports columnists Patrick Johnston, Ben Kuzma, J.J. Abrams and others. Plus, Canucks Report, Sports and Headline News newsletters and events. Unlimited online access to The Province and 15 news sites with one account. The Province ePaper, an electronic replica of the print edition to view on any device, share and comment on. Daily puzzles and comics, including the New York Times Crossword. Support local journalism. SUBSCRIBE TO UNLOCK MORE ARTICLES Subscribe now to read the latest news in your city and across Canada. Exclusive articles by top sports columnists Patrick Johnston, Ben Kuzma, J.J. Abrams and others. Plus, Canucks Report, Sports and Headline News newsletters and events. Unlimited online access to The Province and 15 news sites with one account. The Province ePaper, an electronic replica of the print edition to view on any device, share and comment on. Daily puzzles and comics, including the New York Times Crossword. Support local journalism. REGISTER / SIGN IN TO UNLOCK MORE ARTICLES Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account. Share your thoughts and join the conversation in the comments. Enjoy additional articles per month. Get email updates from your favourite authors. THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK. Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account Share your thoughts and join the conversation in the comments Enjoy additional articles per month Get email updates from your favourite authors The carrier said it has rolled out a 'contingency plan' that allows it to keep serving its 50,000-plus customers, which range from retailer Lululemon to e-commerce giants Shein and Temu. 'With the implementation of these proactive measures, we are pleased to confirm that we can sustain our operations throughout our Canadian network, and we do not anticipate significant disruptions to our service,' DHL spokeswoman Pamela Duque Rai said Sunday in an email. Unifor, which represents more than 2,000 DHL truck drivers, couriers, warehouse and call centre employees, denounced any steps to supplant unionized workers with temporary ones. The move remains technically legal, said union president Lana Payne, as legislation banning replacement workers will not fully take effect until June 20. Essential reading for hockey fans who eat, sleep, Canucks, repeat. By signing up you consent to receive the above newsletter from Postmedia Network Inc. Please try again This advertisement has not loaded yet, but your article continues below. 'DHL sees this as a bit of a loophole and a time for them to put maximum pressure on our membership to concede,' she said in a phone interview. Unifor president Lana Payne. Photo by Postmedia Payne also warned of a chill setting in at the bargaining table. 'The relationship also worsens when you have an employer that thinks they can use replacement workers.' The company bused would-be temporary workers to a Hamilton, Ont., sorting facility for a tour last week and hinted in recent days it planned to take them on if a work stoppage unfolded, she claimed. The company did not immediately respond to questions about replacement hires. The work stoppage adds to the labour turmoil in the parcel market, as Canada Post remains at loggerheads with 55,000 workers amid an overtime ban imposed by the Canadian Union of Postal Workers. This advertisement has not loaded yet, but your article continues below. Unifor said its bargaining priorities remain wages, working conditions and surveillance and automation in the workplace. It also pointed to DHL's proposals to change the driver pay system it said could see some workers travelling up to 100 kilometres for pickups with no compensation, on top of rerouted pickups and reduced pay for 'owner-operators' — independent contractors represented by Unifor alongside full-time employees. DHL was 'disappointed' it could not reach a deal, said Duque Rai. Its proposal includes a 15 per cent wage hike over five years as well as new premiums for transportation of dangerous goods, according to DHL. 'The proposed terms relating to the review of our routes and a revised compensation model for owner operators is designed to address changes to the economic viability and operational structure of the Canadian market and would continue to ensure that drivers operating for DHL Express receive highly competitive compensation,' she said. This advertisement has not loaded yet, but your article continues below. The company poured cold water on the union's warning that the work stoppage could disrupt next weekend's Formula One Canadian Grand Prix in Montreal, where DHL is responsible for transporting the turbocharged race cars. DHL's F-1 work is separate from its other operations in Canada, the company said. Read More Our website is the place for the latest breaking news, exclusive scoops, longreads and provocative commentary. Please bookmark and sign up for our daily newsletter, Posted, here. Vancouver Canucks Sports Local News Sports News
CBC
2 hours ago
- CBC
Alberta asks for a West Coast pipeline as a nation-building project
The federal government has tabled a signature piece of legislation designed to invest in what Prime Minister Carney is referring to as 'nation-building projects.' The CBC's Sam Brooks takes us into how the Alberta government is responding.
Globe and Mail
2 hours ago
- Globe and Mail
Hims & Hers Stock Is Soaring Again. But Should You Buy the Stock?
Many companies have failed to disrupt the complicated U.S. healthcare market. Hims & Hers (NYSE: HIMS) may finally be succeeding in cracking the code. The online telehealth platform focuses on circumventing the insurance market; its business of selling affordable medications directly to individuals is growing like a weed, and expects to generate $6.5 billion in revenue by 2030. It has had a tumultuous start to 2025, as Hims & Hers waged a battle to sell new weight loss medications on its online marketplace. Now, with momentum back on its side, the stock is up 118% year to date and 446% in the last five years. Let's take a deeper look at this company, and see whether you might want to buy Hims & Hers stock for your portfolio now. Disrupting the healthcare market Hims & Hers' model is simple. It has two separate web platforms -- Hims for men and Hers for women -- that sell medications and deliver to customers' front doors. It began with sexual health, but has moved into dermatology, hair loss, mental health, and now weight loss medications. A key to its success has been avoiding the insurance market with products that don't break the bank. Customers loathe dealing with health insurers in the United States, and sometimes would rather not use insurance at all. Plus, some of these products aren't covered by insurance. This strategy has helped the company close in on over $2 billion in projected revenue in 2025. To keep up this impressive growth, Hims & Hers wants to offer weight loss medications, which have been a blockbuster set of drugs for the pharmaceutical market. For a while the popularity of these drugs, such as Novo Nordisk 's Wegovy, left them in short supply; that allowed third parties such as Hims & Hers to produce them as a compounding pharmacy and sell them at much cheaper prices. This ended up generating $200 million of Hims & Hers' $1.4 billion in 2024 revenue. But with the shortage of Wegovy over and the compounding pharmacy exception ended, the company's weight-loss business was at a major turning point. Luckily, at the end of April Hims & Hers announced a partnership with Novo Nordisk that seems to resolve this issue: It gives Hims & Hers the ability to sell Wegovy directly on its platform. Hims & Hers is not an exclusive supplier of the drug -- or any drugs on its marketplaces, to be fair -- but it hopes to use its subscription business model, marketing expertise, and simplified user proposition to drive sales for Novo Nordisk in the huge obesity-care market. Going abroad and personalization Besides weight loss drugs, Hims & Hers has more ambitions to reach its goal of $6.5 billion in revenue by 2030. Just recently, the company announced its intent to acquire European competitor Zava so it could expand its telehealth service to Europe. The acquisition will add a platform with 1.3 million active customers in the U.K., Germany, France, and Ireland. It makes sense that Hims & Hers can supercharge growth for the platform with its plethora of medications offered to customers, keen marketing skills, and subscription-based selling model. Over the long run, Hims & Hers aims to make healthcare for its customers more personalized. This includes unique drug combinations, its own outsourcing facility, and at-home testing capabilities. Details remain sparse, but the vision is clear: disrupting more and more of the trillions of dollars spent on healthcare by building a business that people actually enjoy interacting with. This is why 2.4 million active customers use Hims & Hers today. HIMS Gross Profit Margin data by YCharts. Should you buy Hims & Hers stock? A revenue goal of $6.5 billion seems well within reach by 2030. Hims & Hers is only at 2.4 million active customers, and there are tens of millions of people in the United States alone who could start using or switch to one of its telehealth platforms. Add on the Zava acquisition in Europe, and the runway for growth gets even larger. The company has an impressive gross profit margin of 77%, which should lead to high levels of profitability at scale. On $6.5 billion in future revenue, it could very well post a net profit margin of over 20%, and achieve $1.5 billion in bottom-line profits and free cash flow. A 20% profit margin is easily achievable because of its high gross margins and the fact it currently spends 40% of revenue on marketing today, a figure that has come down over time and should come down even more as Hims & Hers keeps scaling. However, Hims & Hers has played fast and loose with laws and regulations in the past. It sold weight loss drugs when the legality of doing so was unclear, and although that dispute seems to have been resolved, management could easily start playing with fire again and burn its reputation as a trusted provider of medications. Otherwise, this looks like a fantastic growth stock that just doubled its addressable market with the Zava acquisition. Today, Hims & Hers has a market cap of $12.3 billion. You might think it's overvalued because of the stock's recent run-up in price, but the numbers show that patient investors could be rewarded by holding for the long term. A $12.3 billion market cap is only around 8 times my 2030 earnings estimate of $1.5 billion, which would be a dirt cheap price-to-earnings (P/E) ratio for a fast-growing company compared to the current market cap. Most likely, the stock will be valued at a higher multiple than 8, meaning that the stock will be higher in five years. It doesn't come without risks, but if you're a growth investor, you might love Hims & Hers stock for its long-term potential. Should you invest $1,000 in Hims & Hers Health right now? Before you buy stock in Hims & Hers Health, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Hims & Hers Health wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $868,615!* Now, it's worth noting Stock Advisor 's total average return is792% — a market-crushing outperformance compared to173%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 2, 2025
