Core Viewpoint - ONEOK Inc. is considered one of the best infrastructure stocks to buy, with significant upside potential despite recent price target reductions by analysts [1][2]. Group 1: Analyst Ratings and Price Targets - Barclays analyst Theresa Chen lowered the price target for ONEOK to $78 from $83, maintaining an Equal Weight rating, indicating that the Q3 2025 financial report will be crucial for assessing the company's synergy targets and earnings growth capabilities [1]. - Earlier, BofA also reduced its price target for ONEOK to $100 from $109 while keeping a Buy rating, reflecting a broader update on price targets for Integrated, Refining, and Midstream stocks [2]. Group 2: Company Overview - ONEOK Inc. operates as a midstream service provider in the U.S., offering services such as gathering, processing, fractionation, transportation, storage, and marine export [3]. - The company is segmented into four main areas: Natural Gas Gathering & Processing, Natural Gas Liquids, Natural Gas Pipelines, and Refined Products & Crude [3].

Core Insights - Companies with a strong history of dividend payments and increases are attractive to income-focused investors, with CareTrust REIT, Hess Midstream, and Kimberly-Clark recently announcing dividend hikes and offering yields up to approximately 8% [1] CareTrust REIT - CareTrust REIT Inc. is a real estate investment trust focused on seniors housing and healthcare-related properties [2] - The company has raised its dividends annually for the last 10 years, with the most recent increase on March 18, raising the quarterly payout from $0.29 to $0.335 per share, equating to an annual figure of $1.34 per share [3] - As of June 30, CareTrust's annual revenue was $277.03 million, with Q2 2025 revenues of $112.47 million and EPS of $0.43, both exceeding expectations [4] Hess Midstream - Hess Midstream LP operates midstream assets and provides fee-based services, having increased dividends for the last eight years [5] - The latest dividend hike on July 28 raised the quarterly payout from $0.7098 to $0.737 per share, resulting in an annual figure of $2.95 per share, with a current dividend yield of 8.64% [5] - The company's annual revenue as of June 30 was $1.57 billion, with Q2 2025 revenues of $414.20 million and EPS of $0.74, both surpassing market expectations [6] Kimberly-Clark - Kimberly-Clark Corp. is engaged in the manufacturing and marketing of personal care products on an international scale [7]

Core Viewpoint - The article discusses the identification of ultra-high-yield dividend stocks, defining "ultra-high" as a yield four times greater than the current S&P 500 yield of approximately 4.4%, resulting in around 1,800 qualifying stocks [1]. Group 1: Energy Transfer as a Candidate - Energy Transfer is highlighted as a potential leading ultra-high-yield dividend stock with a yield of approximately 7.9% [3]. - The company is noted for the sustainability of its distribution, despite a high earnings-based payout ratio of 100%, as it generates sufficient distributable cash flow [4]. - Management anticipates consistent distribution growth of 3% to 5% annually [4]. Group 2: Financial Performance and Valuation - Energy Transfer's adjusted EBITDA is projected to grow at a compound annual growth rate of 10% from 2020 to 2024, driven by increasing power demand from AI data centers [5]. - The company's forward price-to-earnings ratio is low at 9.7, and its trailing-12-month enterprise value-to-EBITDA is among the lowest in its peer group, indicating attractive valuation [6]. Group 3: Concerns and Historical Context - Despite its advantages, Energy Transfer has faced criticism due to a distribution cut in 2020 linked to the COVID-19 pandemic, which raises concerns about its distribution track record [9]. - The article mentions that while the company has increased its distribution in recent years, the past cut remains a significant point of contention [9].

Core Insights - High-yield stocks can enhance income from diversified investment portfolios, balancing risk and reward is essential [1] - Energy Transfer and Realty Income are highlighted as exceptional high-yield stocks to consider [2] Energy Transfer - Energy Transfer is a leading midstream energy company in North America, crucial for transporting natural gas to power AI data centers and other sectors [4] - The company operates over 140,000 miles of pipelines and has a network of facilities for gathering, processing, storage, and export, facilitating the movement of hydrocarbons [5] - Energy Transfer has a market cap of $58 billion, with a current price of $16.76 and a dividend yield of 8%, expecting to increase distributions by up to 5% annually [7][9] - The company is developing an LNG export terminal in Lake Charles, Louisiana, to meet rising global demand for liquefied natural gas, particularly in Europe [7] - The onshoring trend in the U.S. manufacturing sector positions Energy Transfer to benefit from increased energy supply needs [8] Realty Income - Realty Income is a real estate investment trust (REIT) that offers a reliable source of passive income without the risks associated with direct property ownership [10] - The REIT manages 15,600 commercial properties leased to over 1,600 tenants across 91 industries, maintaining diversified revenue streams [11] - Realty Income has consistently high occupancy rates above 96% since 1992, with a current yield of 5.5% and a history of 664 consecutive monthly dividends [13][14] - The total addressable market for Realty Income is estimated at $14 trillion, providing significant growth potential for its real estate holdings and cash payouts [15] - Potential near-term profit boosts may arise from anticipated cuts in benchmark interest rates by the Federal Reserve, reducing borrowing costs [16]

Core Insights - ONEOK, Inc. is a midstream energy company with a market cap of approximately $42.9 billion, involved in various operations including gathering, processing, and transportation of natural gas and crude oil [1] Earnings Expectations - Analysts anticipate ONEOK to report an EPS of $1.48 for the upcoming third quarter, reflecting a 25.4% increase from $1.18 in the same quarter last year [2] - For the full fiscal year 2025, the expected EPS is $5.44, which is a 5.2% increase from $5.17 in fiscal 2024, and a further increase to $6.19 per share is projected for fiscal 2026, representing a 13.8% year-over-year growth [3] Stock Performance - ONEOK's stock has declined by 29.5% over the past 52 weeks, underperforming the S&P 500 Index, which gained 14.8%, and the Energy Select Sector SPDR Fund, which saw a 3.8% dip [4] Factors Influencing Stock Price - The recent weakness in ONEOK's share price is attributed to modest earnings growth, increased interest expenses, and a valuation reset following acquisitions, compounded by broader macroeconomic pressures [5] - The company's cash flows, while stable, are sensitive to changes in interest rates and energy prices, and its recovery may hinge on the successful integration of recent acquisitions and improved market sentiment [5] Analyst Ratings - The stock holds a consensus "Moderate Buy" rating, with 11 out of 19 analysts recommending a "Strong Buy," one a "Moderate Buy," and seven advising a "Hold." The mean price target is $93.44, indicating a 36.3% upside potential from current levels [6]

Core Viewpoint - The stock market has risen significantly, with the S&P 500 up over 13%, but certain energy stocks are trading at low valuations, presenting investment opportunities for discerning investors [1]. Group 1: Energy Transfer - Energy Transfer (ET) trades at less than 9 times earnings, the second-lowest in its peer group, which averages around 12 times, resulting in a high yield of 8% [2]. - The company has achieved a 10% compound annual earnings growth rate since 2020 and is in its strongest financial position in history [2]. - Energy Transfer is investing $5 billion in growth capital projects this year, with additional projects scheduled to enter commercial service through 2029, aiming to grow its distribution by 3% to 5% annually [3]. Group 2: MPLX - MPLX trades at a low valuation, offering a distribution yield of 7.8%, and has grown its earnings and cash flow at nearly 7% compound annual rate since 2021 [4]. - The company is deploying over $5 billion into growth initiatives this year, including organic expansion and accretive acquisitions, with projects lined up through the end of the decade [5]. Group 3: Plains All American Pipeline - Plains All American Pipeline (PAA) has a high yield of 9.6% due to its low valuation and has experienced 7% compound annual earnings growth since 2021 [6]. - The company is optimizing its portfolio by selling Canadian natural gas liquids assets to enhance cash flow durability and reinvesting in more resilient cash flow-producing assets [7]. Group 4: General Insights on MLPs - Energy Transfer, MPLX, and Plains All American Pipeline are trading at low valuations partly due to their MLP structures, which require more complex tax filings but offer high-yield income that can justify the effort for investors seeking bargains [8].

Core Insights - Fairholme Capital Management's portfolio is valued at $1.23 billion, with the top five holdings constituting 99.32% of total assets, reflecting a concentrated investment strategy [1][7] Group 1: Top Holdings - The largest holding is St. Joe Company (JOE), with 20.20 million shares valued at $963.7 million, representing 78.54% of the portfolio. Berkowitz trimmed 2,700 shares, maintaining a controlling stake, driven by confidence in JOE's Florida real estate and long-term value creation [2] - The second-largest holding is Enterprise Products Partners (EPD), with 5.45 million units valued at $169.0 million, accounting for 13.77% of assets. No changes were made this quarter, highlighting a focus on stable, high-yielding infrastructure assets [3] - Bank OZK (OZK) represents 3.52% of the portfolio, with 916,752 shares valued at $43.14 million. Fairholme added 285,150 shares, indicating renewed confidence in the bank's conservative balance sheet and profitability [4] - Berkshire Hathaway Inc. Class B (BRK.B) holds 1.92% of assets, with 48,597 shares valued at $23.61 million. A slight reduction in stake reflects portfolio maintenance rather than a change in conviction [5] - W. R. Berkley Corp (WRB) rounds out the top five with 261,450 shares worth $19.21 million, representing 1.57% of the portfolio. No changes were made this quarter, showcasing exposure to high-quality insurers [6] Group 2: Investment Philosophy - Berkowitz's investment strategy emphasizes concentration and patience, with nearly 80% of the portfolio in a single real estate holding and additional investments in energy, banking, and insurance [7] - The approach is characterized by a focus on intrinsic value, dependable cash flows, and management alignment, rather than diversification or chasing momentum [7]

Group 1 - Roberts Berzins has over a decade of experience in financial management, assisting top-tier corporates in shaping financial strategies and executing large-scale financings [1] - Significant efforts have been made to institutionalize the REIT framework in Latvia to enhance the liquidity of pan-Baltic capital markets [1] - Development of national SOE financing guidelines and frameworks for channeling private capital into affordable housing stock has been a focus [1] - Roberts is a CFA Charterholder and holds an ESG investing certificate, with experience from an internship at the Chicago Board of Trade [1] - Active involvement in "thought-leadership" activities supports the development of pan-Baltic capital markets [1]

Core Viewpoint - The energy sector has underperformed since the new bull market began in 2022, with the S&P 500 Energy Index only up about 3% compared to a 14% gain in the overall market [1][2]. Industry Performance - Energy stocks have struggled due to concerns over slowing global demand and a shift in investor preference towards higher-growth sectors like technology and communication services [2][3]. - Oil prices have decreased to approximately $61 per barrel, struggling to surpass the $70 psychological level [3]. - The energy sector is currently trading at significant discounts, presenting a higher risk-reward profile compared to the broader market, which is facing premium valuations [4]. Long-term Outlook - The long-term outlook for the energy sector remains positive, bolstered by a $750 billion trade agreement between the U.S. and the European Union, which mandates the EU to purchase U.S. energy exports over the next three years [5][6]. - Achieving the $750 billion target is ambitious, as current import levels are under $100 billion, requiring the EU to import 67% of its energy needs from the U.S. [6]. Methodology for Stock Selection - The list of the most profitable energy stocks was compiled using Finviz to screen for companies with positive earnings and over $1 billion in trailing twelve-month (TTM) net income, focusing on those with a TTM Operating Margin of at least 15% and popularity among elite hedge funds [8]. - The strategy of selecting stocks that hedge funds favor has historically outperformed the market, with a reported return of 427.7% since May 2014 [9]. Notable Energy Stocks - **Western Midstream Partners, LP (NYSE:WES)**: TTM Operating Margin of 43.29%, TTM Net Income of $1.27 billion, and 5 hedge fund holders. UBS has a 'Neutral' rating with a $40 price target, awaiting the completion of a $1.4 billion acquisition [10][11]. - **MPLX LP (NYSE:MPLX)**: TTM Operating Margin of 39.64%, TTM Net Income of $4.31 billion, and 13 hedge fund holders. UBS has a 'Buy' rating with a $64 price target, citing expected volume growth and an increase in EBITDA estimates [13][14].

Core Insights - AI and AI investing have significantly driven stock market growth in 2023, leading to increased demand for data centers and related energy needs [1] - The surge in data center energy demand has created new opportunities in the natural gas and midstream sectors, evidenced by recent key deals [1] Group 1: Company Investments - Williams Companies, Inc. (WMB) has committed an additional $3.1 billion to two power innovation projects, raising its total investment in power projects to approximately $5 billion [2] - WMB has secured 10-year fixed-price power purchase agreements with a large investment-grade counterparty for the new projects, expected to be completed in the first half of 2027 [3] - WMB has increased its 2025 growth capital expenditure guidance by $875 million to a midpoint of $3.6 billion, anticipating a 20% return on the new projects [3] Group 2: Natural Gas Supply Agreements - Energy Transfer (ET) has entered into an agreement with Fermi America (FRMI) to supply natural gas to FRMI's HyperGrid AI data center campus in Texas, highlighting the growing energy needs of data centers [4] - VoltaGrid has also announced a 2.3 GW agreement with ET to supply electricity generated from natural gas to Oracle's data centers, further demonstrating the demand for natural gas in the sector [4] Group 3: Data Center Demand and Infrastructure - Pembina Pipeline Corporation (PPL) is nearing a deal with Meta (META) for a new data center in western Canada, which will utilize natural gas-fired electricity from the Greenlight Electricity Centre [5] - The Greenlight Electricity Centre is expected to have a capacity of up to 1.8 GW, translating to a natural gas demand of 320 million cubic feet per day [5] - Key players in the midstream energy infrastructure, including WMB, ET, and PPL, are significant constituents of the Alerian Energy Infrastructure ETF, which focuses primarily on natural gas infrastructure [6]