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On September 14, during the lightning round of Mad Money, a caller asked if they should be concerned about Energy Transfer LP (NYSE:ET) moving its primary stock listing from the New York Stock Exchange to the Texas Stock Exchange on October 5. In response, Jim Cramer said:
No, I actually, you know, I got to tell you, I think that's kind of more optics although smart optics... I think ET is terrific. I'm going to say buy, buy, buy ET.
Strong Infrastructure and Fee-Based Cash Flow Generation
The core investment thesis for Energy Transfer LP (NYSE:ET) rests on its massive operational footprint spanning more than 140,000 miles of pipelines across 44 states. Because the majority of its earnings rely on long-term fee-based contracts rather than direct commodity price exposure, the partnership generates predictable cash flows across market cycles. The stability powered a strong second quarter featuring $5.07 billion in adjusted EBITDA while prompting management to raise full-year adjusted EBITDA guidance to a range of $18.8 billion to $19.1 billion from prior guidance of $18.2 billion and $18.6 billion. Income-focused investors also benefit from a strong distribution profile, highlighted by a quarterly cash distribution of $0.34 per common unit with years of consecutive increases and strong cash flow coverage.
Evaluating Capital Intensity and Regulatory Pressures
Despite strong cash generation, Energy Transfer LP (NYSE:ET) carries a substantial debt load, reporting $68.4 billion in total debt on its balance sheet along with growth capital expenditures projected between $5.6 billion and $5.9 billion for the year. Balancing extensive infrastructure development with a large consolidated debt load makes project execution, capital discipline and financing costs important risks for investors.
Tracking Professional Capital Allocations and Market Sentiment
According to the Insider Monkey database, 32 hedge funds held positions in the company in Q2, compared to 34 in the prior quarter. With 13.32 million shares, Omega Advisors was the most prominent shareholder among the hedge funds. The short interest remains exceptionally low, with the short percentage of float sitting at 0.86%, highlighting limited bearish positioning among investors.
Cramer's comment on Energy Transfer LP (NYSE:ET) highlights why experienced investors look past minor administrative headlines like exchange relocations. With an irreplaceable pipeline network generating reliable fee-based cash flows and supporting high-yielding distributions, the business fundamentals offer an attractive setup for anyone seeking durable exposure to North American energy transport.
While we acknowledge the potential of ET as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
READ NEXT: Jim Cramer Questions TJX After Marmaxx Stumbles and Jim Cramer Says Lululemon (LULU) is in "No Man's Land" After Another Brutal Quarter.
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Jim Cramer on Energy Transfer: “I Think It Is Inexpensive and It’s Got a Good Dividend” Insider Monkey • 3mo ago ET CL=F
Jim Cramer on Energy Transfer: “I Think It Is Inexpensive and It’s Got a Good Dividend”
Jim Cramer on Energy Transfer: “Very Inexpensive Stock, Great Pipeline Company” Insider Monkey • 7mo ago ET CL=F
Jim Cramer on Energy Transfer: “Very Inexpensive Stock, Great Pipeline Company”
Jim Cramer Says “Energy Transfer is an Excellent Company” Insider Monkey • 10mo ago ET CL=F
Jim Cramer Says “Energy Transfer is an Excellent Company”
Jim Cramer on Energy Transfer: “That Is the Kind of Stock That You Want to Own in This Environment” Insider Monkey • 6mo ago ET CL=F
Jim Cramer on Energy Transfer: “That Is the Kind of Stock That You Want to Own in This Environment”
Energy Transfer (ET) Enter Multiple New Agreements Through Affiliates Insider Monkey • 2mo ago ET MTDR
Energy Transfer (ET) Enter Multiple New Agreements Through Affiliates
9 Months Later: Did Jim Cramer’s Top Dividend Pick for Retirees Deliver? 24/7 Wall St. • 4mo ago ET NVDA
9 Months Later: Did Jim Cramer’s Top Dividend Pick for Retirees Deliver?
Raymond James Sees Attractive Outlook for Energy Transfer (ET), Adds to Favorites Insider Monkey • 5mo ago ET ORCL
Raymond James Sees Attractive Outlook for Energy Transfer (ET), Adds to Favorites
Jeffries Analyst Initiates Coverage on Energy Transfer (ET) Insider Monkey • 10mo ago ET ET-PI
Jeffries Analyst Initiates Coverage on Energy Transfer (ET)
Barclays Maintains Overweight Rating on Energy Transfer LP (ET) Insider Monkey • 7mo ago ET
Barclays Maintains Overweight Rating on Energy Transfer LP (ET)
Jefferies Raises Energy Transfer (ET) Price Target, Calls Gas Project Updates ‘Rather Exceptional’ Insider Monkey • 6mo ago ET ET-PI
Jefferies Raises Energy Transfer (ET) Price Target, Calls Gas Project Updates ‘Rather Exceptional’
