Analyst Michael Blum from Wells Fargo maintained a Buy rating on Energy Transfer (ET – Research Report) and keeping the price target at $21.00.
Discover the Best Stocks and Maximize Your Portfolio:
- See what stocks are receiving strong buy ratings from top-rated analysts.
- Filter, analyze, and streamline your search for investment opportunities with TipRanks’ Stock Screener.
Michael Blum’s rating is based on Energy Transfer’s strategic initiatives in the behind-the-meter (BTM) sector, particularly the pioneering supply-only deal with CloudBurst, a data center developer. This agreement, which involves a substantial gas supply contract through the Oasis pipeline, highlights ET’s potential to leverage the growing data center market in Texas. The deal could set a precedent for similar contracts across ET’s pipeline network, potentially enhancing the valuation of its gas pipeline assets.
Furthermore, the flexibility of the Oasis Pipeline to charge market rates and the willingness of CloudBurst to commit to a 10-year contract mitigate some of the risks associated with BTM projects. The emphasis on speed to market, amidst grid congestion, enhances the attractiveness of ET’s model despite some efficiency drawbacks. These factors collectively contribute to the positive outlook for Energy Transfer, justifying the Buy rating assigned by Michael Blum.
In another report released today, Barclays also maintained a Buy rating on the stock with a $25.00 price target.