Energy Transfer Equity (ETE) paid a distribution of $0.31 per unit for the third quarter, which represents an annualized distribution of $1.22 per unit for 2018—an increase of 6% year-over-year. In comparison, Williams Companies (WMB) paid a dividend of $0.34 per share, which implies an annualized dividend of $1.36 per share. The dividend growth is more than 13% year-over-year.
Currently, Energy Transfer Equity is trading at a yield of 7.1%, while Williams Companies offers a dividend yield of 4.8%. In comparison, the Alerian MLP ETF (AMLP) is trading at a yield of 7.6%.
The above chart shows Energy Transfer Equity and Williams Companies’ historical dividend yields. The spurt in the yields during early 2016 is when stock prices fell to multiyear lows and crude oil touched its lowest point.
Williams Companies expects 10%–15% annual dividend growth over the next year. Energy Transfer Equity’s long-term distribution growth could depend on the timely completion of its organic projects.
Williams Companies is trading at a forward EV-to-EBITDA valuation of 12.5x, while Energy Transfer Equity is trading at a forward EV-to-EBITDA of 10x. However, Energy Transfer Equity’s valuation could be misleading given its pending merger with Energy Transfer Partners (ETP).
Next, we’ll discuss where these midstream stocks might go in the near future.
According to analysts, Energy Transfer Equity (ETE) stock has a median target price of $21.53—compared to its current market price of $17.40.
Yesterday, Apple (AAPL) launched a newly upgraded range of its iPad Air and iPad mini devices ahead of its March 25 special event.
Nike (NKE) is scheduled to report its earnings results for the third quarter of fiscal 2019 after the market closes on March 21.
On March 18, Chesapeake Energy’s (CHK) implied volatility was 51.9%, which is ~14.7% less than its 15-day average.
Sprint (S) reported an adjusted EPS of $0.06 in the first nine months of fiscal 2018—compared to $0.08 during the same period in fiscal 2017.
On March 18, Brent crude oil May futures settled ~$8.2 higher than the WTI crude oil May futures. On March 11, the spread was ~$9.5.
Out of the 34 analysts covering Broadcom (AVGO), 25 analysts rated the stock a “buy,” while nine analysts rated the stock a “hold."