Lynch Picks: Buy The Williams Companies (WMB)
The Williams stock $WMB is appealing for several reasons. First, unlike oil and gas companies, Williams Companies' earnings are very consistent, attracting dividend investors to the stock's 5% yield.
Over the past six years, Williams' contracted transmission capacity and gathering volumes have increased steadily. As a result, its pipelines' capacity could be more utilized, and the contract rates are frequently not influenced by commodity prices. That explains why, despite significant swings in oil and gas prices, adjusted EBITDA has been increasing steadily over time.
Over the past six years, Williams' contracted transmission capacity and gathering volumes have increased steadily. As a result, its pipelines' capacity is mainly underutilized, and the contract rates are frequently not influenced by commodity prices. That explains why, despite significant swings in oil and gas prices, adjusted EBITDA has been increasing continuously over time.
The strategic position of Williams' assets is one of the main factors contributing to the consistent growth in the company's gathering and transport volumes. As a result, Williams Companies not only produces consistent profits, but it also can do so in the future.
The company trades at an attractive valuation point with PEG of 0.20, and it is expected to gain from the anticipated increase in natural gas demand in the following years.
Source: Company's Presentation