ET Should I Buy
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ET
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Energy Transfer LP (ET) is not a strong buy at the moment for a beginner investor with a long-term strategy and $50,000-$100,000 available for investment. While the company offers a high dividend yield and has plans for distribution growth, the technical indicators are bearish, and the financial performance shows declining profitability. Additionally, the stock's near-term trend suggests potential downside, making it less attractive for immediate entry.
The technical indicators for ET are bearish. The MACD is below zero and negatively contracting, the RSI is at 15.626 indicating an oversold condition, and the moving averages are bearish (SMA_200 > SMA_20 > SMA_5). The stock is trading below key support levels, with a pivot at 17.012 and resistance levels at 17.455 and 17.729. The stock trend analysis predicts a high probability of further decline (-4.25% next day, -21% next week, -9.16% next month).
Hedge funds are significantly increasing their positions in ET, with a 19964.53% increase in buying over the last quarter.
The company has consistently increased its dividend from 2022 to 2025 and plans for 3%-5% annual distribution growth.
Analysts from RBC and Scotiabank maintain an Outperform rating, citing strong power demand and LNG export tailwinds.
Technical indicators are bearish, and the stock shows a high probability of further decline in the short term.
Financial performance in Q4 2025 shows declining profitability, with net income down -13.89% YoY and EPS down -13.79% YoY.
Analysts from Morgan Stanley downgraded the stock to Equal Weight, citing a lack of catalysts to re-rate the shares higher.
The stock's valuation discount remains a concern, as noted by Jefferies.
In Q4 2025, Energy Transfer LP reported a 29.57% YoY increase in revenue to $25.32 billion. However, net income dropped by -13.89% YoY to $868 million, and EPS fell by -13.79% YoY to 0.25. Gross margin also declined by -15.06% YoY to 17.43%. While revenue growth is strong, declining profitability metrics are a concern.
Analysts have mixed views on ET. Jefferies raised the price target to $20 but maintained a Hold rating, citing exceptional natural gas project updates but concerns over valuation discount. RBC and Scotiabank maintain Outperform ratings with price targets of $21 and $22, respectively, citing strong power demand and LNG export tailwinds. Morgan Stanley downgraded the stock to Equal Weight with a $19 price target, citing a lack of catalysts for share outperformance.
