Texas Stock Exchange Lands Nearly $100B In First Corporate Listings

U.S. natural gas prices have dropped 24% this year, benefiting midstream operators like Kinder Morgan (KMI), Energy Transfer (ET), and Williams (WMB). These companies earn fees from transporting gas, and their stocks have risen 23%, 20%, and 17% YTD, respectively. KMI reported record Q3 earnings and plans $4.7B in gas pipeline investments. The EIA notes that 37% of U.S. gas is a byproduct of oil drilling, contributing to supply glut.

Energy Transfer LP (ET) is a midstream energy company with pipelines and infrastructure across 44 states. Over 10 years, a $1,000 investment grew to $1,870, with an average annual gain of 6.46%. The company plans growth through acquisitions, like the $2.6 billion deal for Vaquero Midstream, and offers a 7% dividend yield. ET is a master limited partnership, requiring K-1 tax forms.

J.P. Morgan initiated coverage on Sunoco LP (SUN) with an Overweight rating and $87 price target, citing growth from the Parkland acquisition. Sunoco offers a 5.25% dividend yield but has a high payout ratio of 75%. The GF Value™ suggests the stock is undervalued, while the GF Score™ is 78/100, reflecting strong valuation and growth but weaker financial strength.

The Pipeline and Hazardous Materials Safety Administration ordered Energy Transfer to inspect and repair its pipelines due to a system-wide risk of leaks, similar to past incidents in Michigan and Pennsylvania. The agency cited failures in repair sleeves and inadequate record-keeping. Energy Transfer's Twin Oaks pipeline, operated by Sunoco LP, is currently running at reduced pressure. Investigations into the leaks are ongoing, and a U.S. representative has called for pipeline safety reforms.

Energy Transfer and its affiliates (Sunoco, SunocoCorp, USA Compression Partners) listed on the Texas Stock Exchange, totaling nearly $100 billion in market value. Energy Transfer alone accounts for $73.5 billion. The exchange raised $430 million in funding, with support from major investors. This is the first primary corporate listing for the Texas Stock Exchange, which began trading in July.

Zacks.com highlights five energy companies involved in recent M&A activity. Crescent Energy (CRGY) to acquire Devon Energy's Eagle Ford assets for $3.85B, Energy Transfer (ET) to buy Vaquero for $2.63B, Cenovus Energy (CVE) to acquire Athabasca for C$5.7B, and Drilling Tools (DTI) to acquire Saltire and Foxley. Deals aim to expand operations, reduce costs, and improve profitability.