As of December 6, 2025, Energy Transfer LP (NYSE: ET) remains one of the most closely watched high‑yield midstream stocks, offering nearly an 8% cash distribution, a deep project backlog, and a still‑discounted valuation despite mixed 2025 earnings.
This update pulls together the latest news, forecasts and analyst commentary on Energy Transfer LP stock as of December 6, 2025, to give a rounded picture of where ET stands heading into 2026.
Energy Transfer LP stock today: price, yield and performance snapshot
Energy Transfer units closed on December 5, 2025 at $16.80, with trading volume a little over 14 million units. [1]
At that price, ET:
- Offers an annualized cash distribution of $1.33 per unit, after the October increase to $0.3325 per quarter. [2]
- Delivers a forward yield of roughly 7.9–8.0%, based on multiple data services. [3]
- Trades on a trailing price/earnings multiple around 13–14x and a forward P/E near 11x, broadly in line with its midstream peer group but still below the broader market. [4]
Performance-wise, ET’s story is split between recent weakness and long‑term strength:
- Over the last 12 months, total return (including distributions) is slightly negative mid‑single digits, with the units down around 5–7% year‑to‑date. [5]
- Over the last five years, however, total return exceeds 270%, meaning $1,000 reinvested in ET in late 2020 would now be worth roughly $3,700–$3,800. [6]
In other words: short‑term choppy, long‑term powerful, which is exactly why the recent earnings wobble plus 8% yield has attracted both income investors and value hunters.
Q3 2025 earnings: headline miss, underlying cash flow solid
On November 5, 2025, Energy Transfer reported Q3 2025 results that missed consensus on both earnings and revenue, triggering a wave of fresh analysis. [7]
Key takeaways from the latest quarter:
- Adjusted earnings per unit (EPS) came in at $0.28, versus analyst expectations around $0.33 and down from $0.32 in the prior‑year quarter. [8]
- Revenue declined year‑over‑year and fell short of Street forecasts, reflecting weaker commodity prices and lower marketing margins, even as transported volumes remained strong. [9]
- Despite the earnings miss, management highlighted record or near‑record volumes across key natural gas, NGL and crude systems, reinforcing the idea that the core fee‑based business remains healthy. [10]
Where the numbers become more interesting for income‑focused investors is distributable cash flow (DCF):
- Multiple analyst summaries and investor write‑ups put Q3 2025 DCF around $1.9 billion, down modestly versus the prior year but still comfortably covering the quarterly payout. [11]
- Earlier in the year, Q2 2025 DCF was about $1.96 billion, implying a distribution coverage ratio of roughly 1.7x, meaning ET generated around 70% more cash than needed to pay its common-unit distribution that quarter. [12]
Combined with management guidance, the message from Q3 is that GAAP earnings are noisy, but cash generation remains robust. Several analysts explicitly frame Q3 as “short‑term pain overshadowed by long‑term gain,” pointing to the growing project backlog and steady cash flow as the more important drivers for the stock. [13]
Dividend profile: steadily rising 8% yield
Energy Transfer has spent the last few years rebuilding and then surpassing its pre‑2020 distribution level, and 2025 has continued that trend.
In 2025 alone, ET has:
- Raised its quarterly common‑unit distribution four times, from $0.325 (paid February) to $0.3275, $0.33, and now $0.3325 (paid November 19, 2025). [14]
- Achieved an annualized distribution of $1.33 per unit, about 3% higher year‑over‑year versus the $1.29 annualized rate in 2024. [15]
At the current price around $16.80, this translates into a forward yield of roughly 7.9%, slightly above the stock’s already‑lofty 4‑year average yield in the mid‑7% range. [16]
A few nuances matter here:
- On a trailing basis, payout ratio metrics (using accounting earnings) are over 100%, with some data services showing around 104%, which might look stretched in a traditional dividend framework. [17]
- For midstream MLPs like ET, DCF and coverage ratio are more important. Coverage has generally stayed well above 1.5x in recent quarters, even taking into account this year’s distribution hikes. [18]
Recent analyst and media commentary broadly characterizes ET’s payout as:
- Attractive and high, especially versus the S&P 500’s ~1.5% yield;
- Supported by fee‑based cash flows and project backlog, but
- Still requiring continued discipline on leverage and capital spending to remain fully comfortable in a stress scenario. [19]
The partnership itself has repeatedly stated a long‑term goal of 3–5% annual distribution growth, backed by a large slate of organic projects and a strong balance sheet. [20]
Growth engine 1: data centers and the Desert Southwest pipeline
One major storyline driving fresh interest in Energy Transfer in late 2025 is the exploding demand for natural gas from data centers and fast‑growing Sun Belt cities, and how ET is positioning itself to serve that demand.
The headline project here is the Desert Southwest expansion of the Transwestern Pipeline:
- Initially designed as a 1.5 Bcf/d, 42‑inch, 516‑mile pipeline with nine compressor stations, moving gas from the Permian Basin to the Phoenix area. [21]
- A recent open season sold out the full 1.5 Bcf/d capacity under long‑term (25‑year) commitments with largely investment‑grade utilities and customers. [22]
- Strong oversubscription has pushed Energy Transfer to evaluate upsizing the pipe to 48 inches, which could add another 0.5–1.0 Bcf/d of capacity. [23]
- The line is expected to enter service around Q4 2029, with pipe mill orders already placed for delivery by late 2027. [24]
Independent midstream research firms see this as a direct play on data center growth, projecting a Southwest gas supply shortfall of well over 1.5 Bcf/d by 2030 if new infrastructure is not built. [25]
Recent deep‑dive articles describe ET as “owning the infrastructure behind AI”, arguing that high‑power data centers and industrial users will increasingly rely on flexible gas generation, which in turn benefits large pipeline systems like Energy Transfer’s. [26]
Growth engine 2: Lake Charles LNG and long‑term export demand
The second major growth pillar is Lake Charles LNG, Energy Transfer’s planned export project at its existing import/regas terminal in Louisiana.
Several important developments have landed in 2025:
- In April 2025, ET signed a non‑binding development agreement with MidOcean Energy, under which MidOcean would fund around 30% of construction costs in exchange for 30% of the LNG output (about 5 mtpa). [27]
- The Federal Energy Regulatory Commission (FERC) granted a fresh extension of time to complete construction and enter service through 2031, removing a near‑term procedural overhang. [28]
- In May 2025, Japan’s Kyushu Electric Power agreed to sign a 20‑year contract to take up to 1 mtpa of LNG from Lake Charles starting around 2030, adding to the project’s long‑term contracted volume. [29]
Even so, management is moving cautiously. In early November, Energy Transfer told investors it will not reach final investment decision (FID) on Lake Charles until it has sold at least 80% of the project’s equity to partners, citing construction cost inflation and a desire to balance risk and returns. [30]
The net result: Lake Charles remains a large, long‑dated call option on global LNG demand. It features heavily in bullish analyst models, but actual capex and cash flow are likely to ramp later in the decade, not in 2026.
Balance sheet, leverage and credit ratings
For a midstream name paying nearly 8%, leverage and balance sheet quality are critical.
Key points as of late 2025:
- Rating agency Fitch affirmed Energy Transfer at ‘BBB’ with a Stable outlook in February 2025, noting the partnership’s target leverage range of 4.0x–4.5x debt-to-EBITDA and its history of operating within that band. [31]
- Recent analysis places ET’s actual leverage a bit above 4x, comfortably within that target but higher than some best‑in‑class peers such as Enterprise Products Partners. [32]
- Management’s 2025 guidance calls for adjusted EBITDA of $16.1–$16.5 billion, up roughly 5% versus 2024, with about $5 billion earmarked for organic growth capex, much of it tied to data‑center‑driven projects and LNG‑linked infrastructure. [33]
A recurring theme in recent analyst notes is that ET’s balance sheet is no longer the “problem child” it was perceived to be several years ago, but still sits on the more leveraged side of the midstream spectrum. Continued progression on:
- Debt reduction,
- Investment‑grade ratings, and
- Maintaining DCF coverage comfortably above 1.5x
is widely seen as essential to support both the current payout and ongoing distribution growth. [34]
Institutional and insider activity: who is buying ET?
Recent filings and ownership data show rising institutional interest in Energy Transfer through 2025:
- Analytics platform Fintel highlights an 8% increase in institutional ownership during Q3 2025, attributing the move partly to ET’s consistent distribution increases and strong asset footprint. [35]
- Reports over the last few months show new or expanded positions from multiple funds, including Highland Capital Management and Tema ETFs LLC, which disclosed fresh stakes in ET in recent quarters. [36]
- Perhaps most notably, long‑time Executive Chairman Kelcy Warren purchased 1 million ET units at an average price of $16.95, lifting his direct holdings to roughly 105 million units, a move widely interpreted as a strong insider confidence signal. [37]
Taken together, the data suggest that institutional and insider capital is leaning into ET’s current valuation, even as the stock trades below its 52‑week high near $21–22 and below its January 2025 peak closing price around $19.58. [38]
What Wall Street expects from Energy Transfer LP stock
Across major data providers, sell‑side analysts remain broadly bullish on ET:
- Average 12‑month analyst price targets cluster around $21.5–$22.2 per unit, implying roughly 28–32% upside from current levels. [39]
- Target ranges generally span $17 on the low end to $25–26+ on the high end, reflecting different views on commodity cycles, project execution and balance sheet risk. [40]
- Overall ratings skew toward “Buy” or “Strong Buy”, with MarketWatch data showing an average rating of Buy across roughly 20 analysts. [41]
Independent valuation platforms and research services add more color:
- A recent Simply Wall St valuation note pegs ET’s fair value around $21.7 per unit, implying about 29% upside from recent prices. [42]
- Several Seeking Alpha contributors argue that ET trades at a discount to peers on EV/EBITDA and yield metrics, despite similar or higher projected DCF growth, framing the units as a “buy‑the‑dip” opportunity for long‑term income portfolios. [43]
One cautionary counterpoint that has gained attention today (December 6, 2025) is a scenario analysis positing $50 oil as a near‑term possibility. In that stress case, the author suggests Enterprise Products Partners (EPD) would be better positioned than ET, citing EPD’s lower leverage, lower payout ratio and higher credit rating. [44]
However, even that more cautious piece acknowledges Energy Transfer’s solid underlying fundamentals and diversified fee‑based business, with the main debate focusing on relative resilience rather than solvency.
Key risks to watch for Energy Transfer LP stock
Despite the appealing yield and strong asset base, recent research and news flow consistently highlight several risks and watchpoints:
- Leverage and capital allocation
- ET’s debt‑to‑EBITDA in the low‑4x range is manageable but not conservative. A sustained commodity downturn or project delays could pressure DCF coverage if not offset by capex cuts or other actions. [45]
- Commodity price and volume sensitivity
- While most cash flows are fee‑based, segments like NGL marketing and crude services still have indirect exposure to commodity prices, which contributed to revenue volatility and earnings misses in recent quarters. [46]
- Regulatory and permitting risk
- Large projects such as Lake Charles LNG and major pipeline expansions remain vulnerable to U.S. regulatory shifts, environmental reviews and political pressure around fossil fuel infrastructure, as seen in earlier licensing delays for Lake Charles exports. [47]
- Execution risk on megaprojects
- Both the Desert Southwest pipeline and Lake Charles LNG are multi‑billion‑dollar undertakings with long construction timelines. Cost inflation, supply‑chain bottlenecks or customer renegotiations could impact returns if not carefully managed. [48]
- High payout plus cyclical backdrop
- With a distribution yield near 8% and a payout that consumes a significant portion of DCF, ET has less margin for error than some lower‑yielding peers if macro conditions deteriorate sharply. Several analysts flag this as the central question: is the yield adequately compensating for that risk? [49]
Bottom line: how Energy Transfer LP stock is positioned going into 2026
Pulling everything together, the late‑2025 picture for Energy Transfer LP stock (ET) looks like this:
- Income story: Near‑8% yield, a multi‑year track record of quarterly distribution increases, and generally strong DCF coverage supported by record volumes and a deep project backlog. [50]
- Growth story: A credible path to mid‑single‑digit EBITDA growth led by AI/data‑center‑driven gas demand, the Desert Southwest pipeline expansion, and long‑dated optionality from Lake Charles LNG. [51]
- Valuation story: A unit price in the mid‑teens, down year‑to‑date but dramatically higher over five years, still implying high‑20s to low‑30s percent upside versus consensus target prices. [52]
- Risk story: Above‑average leverage for a midstream blue chip, high payout, regulatory overhang on LNG, and the usual macro uncertainties around commodity cycles and interest rates. [53]
For now, analysts, institutional investors and insiders are largely leaning in rather than leaning out, seeing the recent earnings volatility as an opportunity to accumulate units in a high‑yield, infrastructure‑heavy name that sits at the crossroads of U.S. gas exports, Sun Belt growth and data center power demand.
References
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