Should You Buy, Sell or Hold Energy Transfer Stock Before Q3 Earnings?

Core Viewpoint - Energy Transfer LP (ET) is anticipated to show improvements in both revenue and earnings for the third quarter of 2024, with a report scheduled for November 6, after market close [1][3]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for ET's third-quarter revenues is $24.23 billion, reflecting a 16.81% increase from the previous year [3]. - The consensus estimate for earnings is 32 cents per unit, indicating a year-over-year growth of 3.3% [3]. Earnings Surprise History - Energy Transfer has beaten the Zacks Consensus Estimate in two of the last four quarters, with an average surprise of 5.15% [4]. Earnings Prediction Model - The model suggests a likely earnings beat for Energy Transfer, supported by a positive Earnings ESP of +7.29% [5]. Factors Influencing Q3 Earnings - Earnings are expected to benefit from organic expansion projects and strategic acquisitions, particularly the WTG acquisition, which enhanced ET's natural gas pipeline and processing network in the Permian Basin [7]. - The company's extensive pipeline network across major production basins in the U.S. is likely to contribute to diverse earnings sources [8]. - Strong export volumes of liquefied petroleum gas and the expansion of natural gas liquids (NGL) export facilities are anticipated to positively impact performance [9]. Price Performance and Valuation - ET's units have appreciated by 30.1% over the past year, outperforming the industry average of 27.4% [10]. - The current trailing 12-month EV/EBITDA ratio for ET is 10.58X, lower than the industry average of 11.98X, indicating relative affordability [12]. Investment Thesis - Energy Transfer's extensive pipeline network and ongoing expansion through organic growth and strategic acquisitions position the company favorably to serve domestic producers and enhance NGL exports [14]. - The company is increasing processing capacity in the Permian region to meet rising demand [14]. Summary - Energy Transfer is benefiting from rising demand and effective utilization of its assets across the U.S., with strategic acquisitions enhancing performance [16].