WMB
Williams Companies Inc
Utilities, Energy
09/21/2017
Presented
| Date | 09/15/2017 |
| Price | $30.30 |
| Market Cap | $25.11B |
| Ent Value | $53.32B |
| P/E Ratio | 49.67x |
| Book Value | $10.06 |
| Div Yield | 3.24% |
| Shares O/S | 828.58M |
| Ave Daily Vol | 4,881,019 |
| Short Int | 1.69% |
Current
| Price | $50.90 |
| Market Cap | $62.04B |
| The Williams Cos., Inc. operates as an integrated natural gas company that explores, produces, transports, sells and processes natural gas and petroleum products. It operates through three segments: Williams Partners, Williams NGL & Petchem Services and Others. The Williams Partners segment includes gas pipeline and domestic midstream businesses. The gas pipeline business includes interstate natural gas pipelines and pipeline joint venture investments, and the midstream business provides natural gas gathering, treating and processing services; NGL production, fractionation, storage, marketing and transportation and deepwater production handling and crude oil transportation services. The Williams NGL & Petchem Services comprises Texas belle pipeline and certain other domestic olefins pipeline assets and certain canadian growth projects under development, including a propane dehydrogenation facility and a liquids extraction plant. The Other segment comprises of corporate operations and Canadian construction services company. The company was founded in 1908 by David Williams and Miller Williams and is headquartered in Tulsa, OK. |
Please note, this is an update to Williams Companies (WMB) - Long, which was originally presented 7/20/2016 ($25.13).
Publicly traded companies mentioned herein: Williams Companies Inc (WMB)
Highlights
Shares of Williams Companies (WMB) have trended sideways year-to-date (down just 2%) after the year kicked off with an ill-timed, dilutive deal that sent the stock down 10%. The presenter remains long at $30, and sees upside potential (to $40-44) for shareholders looking out to 2018-19 on EBITDA growth and deleveraging. Downside should be limited due to decreased exposure to Chesapeake (from the high teens to low double digits) and the sale of an ethylene cracker that had weighed on results. With 97% of the business now fee-based, WMB could grow EBITDA by 7% - or slightly better - per year through the end of the decade. Applying a reasonable mid-teens multiple to the presenter’s estimates for distributable cash flow (DCF) per share in 2018 and 2019 (~$1.90 and ~$2.20, respectively) results in upside to $35 near-term. Longer-term, there is still the potential for upside into the $40s if EBITDA can grow faster than modeled in the base case.
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