Core Insights - The average person under 65 needs approximately $84,000 annually to achieve financial freedom, according to The Motley Fool [1] Investment Opportunities - Energy Transfer (NYSE: ET) offers a high income yield of 7.5%, significantly higher than the S&P 500's yield of around 1.2% [2] - To generate $84,000 in passive income from Energy Transfer, an investment of about $1.1 million is required at the current unit price of $18, based on a quarterly distribution of $0.335 per unit [4] Financial Strategy - Using the 4% rule, an individual would need to accumulate $2.1 million to withdraw $84,000 annually without depleting the principal [3] - An income-focused portfolio strategy allows for covering annual expenses solely through passive income, preserving the principal [3] Risk Factors - While investing in Energy Transfer can potentially provide sufficient passive income, relying on a single investment carries risks, especially if distribution payments are cut [5] - The risk of a distribution cut is currently lower, as Energy Transfer is in a strong financial position, with about 90% of its cash flow coming from stable, fee-based sources [6] - The company retains over half of its cash flow for reinvestment, aiming to increase distributions by 3% to 5% annually [6]

Core Insights - Energy Transfer's unit price surged 11.9% in January 2026, significantly outperforming the S&P 500's 1.4% gain [1] - The surge was driven by rising crude oil prices and the company's positive outlook for 2026 [1][6] Oil Price Impact - WTI crude oil prices increased by 14% in January, marking the first monthly gain in six months, influenced by potential supply issues in Venezuela and Iran [4] - Although oil prices impact only 5% to 10% of Energy Transfer's earnings, higher prices can boost those earnings and incentivize increased production, enhancing the company's volumes and growth prospects [5] 2026 Outlook - Energy Transfer expects adjusted EBITDA for 2026 to be between $17.3 billion and $17.7 billion, reflecting a growth rate of 7.5% to 10% from last year's $16.1 billion, a significant acceleration from less than 4% growth in 2025 [7] - The company anticipates benefits from several expansion projects, including the Nederland Flexport NGL expansion and gas pipeline projects for Texas data centers [7] Capital Investment and Growth - Energy Transfer plans to invest between $5 billion and $5.5 billion in growth capital projects this year, up from $4.6 billion last year, primarily to enhance its gas pipeline network [8] - The company is also exploring opportunities to meet the growing power demand from AI data centers [8] Cash Distribution - The company has raised its cash distribution by more than 3% over the past year, aligning with its long-term target of 3% to 5% annual distribution growth [9]

Energy Transfer LP (NYSE:ET) is one of the 11 Best Pipeline and MLP Stocks to Buy in 2026. RBC Capital Lowered Price Target on Energy Transfer (ET) On January 28, 2026, RBC Capital lowered its price target on Energy Transfer LP (NYSE:ET) from $22 to $21 while maintaining an Outperform rating on the shares. The update was part of RBC’s broader research note previewing the fourth quarter for the U.S. Midstream industry. RBC Capital noted underperformance in stocks focused on natural gas compared to those r ...

Based in Dallas, Texas, Energy Transfer (NYSE: ET) has a very attractive 7.3% distribution yield. That is likely to attract dividend investors looking to maximize the income their portfolios generate. However, before you buy, you'll want to know a few facts about the business backing that yield. Energy Transfer is a little complex Energy Transfer is one of the largest midstream operators in North America. It basically owns energy infrastructure, such as pipelines, that help move oil and natural gas arou ...

Core Viewpoint - Investors favor dividend stocks due to their reliable, high yields which provide substantial passive income and significant total return potential [1] Group 1 - Dividend stocks are attractive for their dependable income streams [1] - High yield dividend stocks are associated with significant total return potential [1]

Core Viewpoint - The energy sector presents attractive dividend yields, with three high-yield energy stocks recommended for investment in February [1] Group 1: Enbridge - Enbridge offers a forward dividend yield of 5.6% and has increased its dividend for 30 consecutive years, supported by strong free cash flow [2] - The company operates over 18,000 miles of liquids pipelines and over 19,200 miles of natural gas pipelines, ranking as the largest natural gas utility by volume in North America [2] - Enbridge has expanded into renewable energy, with projects generating over 7.2 gigawatts of electricity [2] - JP Morgan downgraded Enbridge due to sluggish growth in its crude oil business, but it is expected to provide stability and reliable income [3] Group 2: Energy Transfer - Energy Transfer operates over 140,000 miles of pipeline across the U.S., transporting crude oil, natural gas, natural gas liquids, and refined products [4] - The company has a distribution yield of 7.3%, appealing to income investors, and benefits from the construction boom of data centers for AI systems [5] - Energy Transfer has signed agreements to supply natural gas to multiple data center operators, including CloudBurst, Fermi America, and Oracle over the past year [5] Group 3: Enterprise Products Partners - Enterprise Products Partners has a distribution yield of approximately 6.3% and has increased its distribution for 27 consecutive years [6] - The company is also positioned to capitalize on growth opportunities related to AI, with around $4.8 billion of projects under construction, expected to begin operations in 2026 [7] - Despite modest growth expectations for 2026, management projects a 10% growth in EBITDA and cash flow in 2027 [8]

Industry Overview - The Zacks Oil and Gas - Pipeline MLP industry consists of master limited partnerships that transport oil, natural gas, refined petroleum products, and natural gas liquids in North America, generating stable fee-based revenues from transportation and storage assets [3] - The industry is currently facing a gloomy outlook due to conservative spending by exploration and production companies, which is expected to reduce demand for transportation and storage assets [1][6] Financial Metrics - The industry has a high debt-to-capitalization ratio of 56.6%, indicating that borrowing is common for financing large infrastructure projects, which may limit financial flexibility [4] - The current trailing 12-month enterprise value-to-EBITDA (EV/EBITDA) ratio for the industry is 11.01X, lower than the S&P 500's 19.05X but above the sector's 5.95X [14] Market Performance - The Zacks Oil and Gas - Pipeline MLP industry has underperformed the broader Zacks Oil - Energy sector and the S&P 500 over the past year, declining by 7.8% compared to the sector's 14.8% gain and the S&P 500's 17.3% rise [10] Future Challenges - The industry is expected to face challenges from a shift to renewable energy, which may lower demand for pipeline and storage networks for oil and natural gas [5] - Oil and gas exploration and production companies are under pressure to prioritize stockholder returns over production growth, negatively impacting the demand for pipeline and storage assets [6] Key Players - Enterprise Products Partners LP (EPD) has a robust business model with a pipeline network exceeding 50,000 miles, generating stable fee-based revenues and returning capital to unitholders consistently [17][18] - Energy Transfer LP (ET) operates a vast pipeline network of 125,000 miles, generating stable revenues and is projected to see earnings growth of 17% this year [20][21] - Plains All American Pipeline LP (PAA) benefits from stable fee-based revenues through its pipeline network and storage assets, with recent upward earnings estimate revisions [23]

Energy Transfer LP (NYSE:ET) is one of the best cheap stocks to buy for 2026. On January 21, Goldman Sachs increased its price target for Energy Transfer LP (NYSE:ET) to $19.00 from $18.50 and kept a Neutral rating on the stock. The firm attributed the adjustment mainly to the upcoming USAC/J-W Power acquisition in the first quarter of 2026. The other key factor is minor tweaks to assumptions about re-contracting in natural gas liquids (NGLs) and crude oil segments, which led to a roughly 1% rise in longer ...

Core Viewpoint - The energy sector, particularly midstream businesses, offers high-yield investment opportunities for income-focused investors in 2026, despite the overall volatility of oil and natural gas commodities [1]. Industry Overview - The energy industry is divided into upstream, midstream, and downstream segments, with upstream and downstream being inherently volatile due to commodity price fluctuations. In contrast, midstream businesses, which own energy infrastructure assets, are more stable as they primarily charge fees for asset usage [2][3]. Midstream Business Characteristics - Midstream companies connect upstream producers to downstream processors and charge fees based on the volume of energy transported rather than commodity prices, leading to more consistent revenue streams [3]. High-Yield Midstream Options - Three notable midstream companies with attractive dividend yields are Enbridge, Enterprise Products Partners, and Energy Transfer, each offering different risk and yield profiles [4]. Enbridge (ENB) - Current Price: $48.28, Market Cap: $105 billion, Dividend Yield: 5.58%, has diversified operations including oil and natural gas pipelines and clean energy, and has increased its dividend for 30 consecutive years [5][6]. Enterprise Products Partners (EPD) - Current Price: $33.10, Market Cap: $72 billion, Dividend Yield: 6.57%, operates solely in oil and natural gas midstream assets, and has a history of conservative management with 27 years of annual dividend increases [7][8]. Energy Transfer (ET) - Current Price: $18.16, Market Cap: $62 billion, Dividend Yield: 7.25%, has the highest yield among the three but previously cut its distribution in 2020 to strengthen its balance sheet, with plans for gradual distribution growth of 3% to 5% annually [9][10].

Energy Transfer and Enterprise Products Partners have similar distribution growth rates, but one has a higher yield.Enterprise Products Partners (EPD 0.27%) and Energy Transfer (ET 1.68%) are two of the largest midstream businesses in North America. They provide services to energy companies, helping to move oil and natural gas around the world for a fee.While the energy sector is generally pretty volatile, these two master limited partnerships (MLPs) have reliable, cash-generating businesses to back their l ...