Energy Transfer (NYSE:ET) Shares Up 1.6% Following Dividend Announcement

Key Points

• Energy Transfer shares rose 1.6% to about $20.23 after the company announced a $0.34 quarterly cash distribution, equal to $1.36 annualized and a yield of roughly 6.7%. The payment is scheduled for August 19 to unitholders of record on August 7.
• Analysts remain broadly bullish, with a consensus “Buy” rating and a $23.50 price target; recent firms raised targets as high as $25.00.
• The company reported 32.1% year-over-year revenue growth in its latest quarter but missed earnings expectations, posting $0.35 per share versus the $0.40 consensus estimate. Elevated leverage remains a potential constraint on valuation expansion.

Energy Transfer LP (NYSE:ET - Get Free Report) shares rose 1.6% during mid-day trading on Tuesday following a dividend announcement from the company. The company traded as high as $20.25 and last traded at $20.2310. Approximately 11,375,413 shares traded hands during trading, a decline of 17% from the average session volume of 13,717,604 shares. The stock had previously closed at $19.91.The newly announced dividend which will be paid on Wednesday, August 19th. Stockholders of record on Friday, August 7th will be given a $0.34 dividend. This represents a $1.36 dividend on an annualized basis and a dividend yield of 6.7%. This is an increase from Energy Transfer's previous quarterly dividend of $0.34. The ex-dividend date is Friday, August 7th. Energy Transfer's dividend payout ratio (DPR) is 112.50%.

Analysts Set New Price Targets

Several brokerages recently commented on ET. Stifel Nicolaus boosted their price objective on shares of Energy Transfer from $23.00 to $25.00 and gave the company a "buy" rating in a research note on Wednesday, May 6th. Weiss Ratings reiterated a "buy (b)" rating on shares of Energy Transfer in a research note on Friday, June 5th. Jefferies Financial Group raised shares of Energy Transfer from a "hold" rating to a "buy" rating and set a $23.00 price target for the company in a report on Tuesday, May 26th. TD Cowen restated a "buy" rating and set a $24.00 price target (up from $23.00) on shares of Energy Transfer in a research report on Thursday, July 16th. Finally, Raymond James Financial reaffirmed a "strong-buy" rating on shares of Energy Transfer in a report on Wednesday, May 6th. Three analysts have rated the stock with a Strong Buy rating, eleven have issued a Buy rating and one has assigned a Hold rating to the company. According to MarketBeat.com, the company has a consensus rating of "Buy" and a consensus price target of $23.50.

Energy Transfer Stock Up 1.6%

The company has a debt-to-equity ratio of 1.50, a current ratio of 1.17 and a quick ratio of 0.93. The company has a fifty day moving average price of $19.54 and a 200 day moving average price of $19.02. The company has a market cap of $69.62 billion, a PE ratio of 16.86, a price-to-earnings-growth ratio of 1.18 and a beta of 0.55.

Energy Transfer (NYSE:ET - Get Free Report) last announced its earnings results on Tuesday, May 5th. The pipeline company reported $0.35 earnings per share for the quarter, missing analysts' consensus estimates of $0.40 by ($0.05). Energy Transfer had a net margin of 4.66% and a return on equity of 9.77%. The company had revenue of $27.77 billion during the quarter, compared to analysts' expectations of $25.78 billion. During the same period in the prior year, the business earned $0.36 earnings per share. The company's revenue for the quarter was up 32.1% compared to the same quarter last year. As a group, analysts anticipate that Energy Transfer LP will post 1.43 EPS for the current year.

Key Stories Impacting Energy Transfer

Here are the key news stories impacting Energy Transfer this week:

• Positive Sentiment: An analyst upgraded Energy Transfer to Strong Buy, citing reduced project-execution risk, approximately 20% year-over-year EBITDA growth to about $4.9 billion and higher full-year EBITDA guidance of roughly $18.4 billion to $18.6 billion. NGL debottlenecking projects and the Hugh Brinson Pipeline are reportedly ahead of or on schedule, potentially supporting additional EBITDA growth. Energy Transfer: Strong Buy On A Quiet Multiple, A Loud Guidance Raise
• Positive Sentiment: Energy Transfer announced its 19th consecutive quarterly cash-distribution increase, raising the payment to $0.34 per common unit, or $1.36 annualized. The distribution is payable August 19 to unitholders of record on August 7, reinforcing the stock’s income appeal with a yield of approximately 6.8%. Energy Transfer Announces Nineteenth Consecutive Increase in Quarterly Cash Distribution
• Positive Sentiment: Another bullish analysis expects distribution growth to accelerate, projecting a 2027 payout of $1.416 per unit and a yield above 7%. It also notes that leverage of 3.85 times EBITDA is below management’s 4.0–4.5 times target range. Energy Transfer: A 7% Yield With Upsizing Distribution Growth On The Horizon
• Neutral Sentiment: Energy Transfer was highlighted as a low-beta, defensive stock that may appeal to investors amid market uncertainty and higher oil prices. Zacks.com Featured Highlights Include Energy Transfer
• Negative Sentiment: Leverage remains higher than that of some midstream peers, which may limit valuation expansion and explains why investors continue to demand a relatively high distribution yield.

Institutional Trading of Energy Transfer

A number of hedge funds have recently made changes to their positions in the stock. Basepoint Wealth LLC bought a new position in Energy Transfer in the fourth quarter valued at $25,000. Gables Capital Management Inc. boosted its holdings in shares of Energy Transfer by 60.0% in the 4th quarter. Gables Capital Management Inc. now owns 1,600 shares of the pipeline company's stock worth $26,000 after purchasing an additional 600 shares in the last quarter. Cassaday & Co Wealth Management LLC bought a new position in shares of Energy Transfer during the 1st quarter valued at about $35,000. Sarver Vrooman Wealth Advisors purchased a new position in shares of Energy Transfer during the 4th quarter valued at about $32,000. Finally, Financial Life Planners purchased a new position in shares of Energy Transfer during the 1st quarter valued at about $40,000. 38.22% of the stock is owned by institutional investors.

About Energy Transfer

Energy Transfer NYSE: ET is a Dallas-based midstream energy company that develops and operates infrastructure for the transportation, storage and processing of hydrocarbons. The company's operations focus on moving and storing natural gas, natural gas liquids (NGLs), crude oil and refined products through an integrated network of pipelines, terminals, storage facilities and processing plants. Energy Transfer provides core midstream services such as gathering, compression, fractionation, processing, and bulk transportation to support production and downstream supply chains.

Its asset base spans an extensive network across the United States, connecting producing regions, processing centers, petrochemical hubs and coastal and inland markets.

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