Should Energy Transfer’s US$10 Billion Expansion And Payout Plan Require Action From ET Investors?

• In early December 2025, Energy Transfer highlighted progress on nearly US$10.00 billion of growth projects, including new Permian pipelines and its Lake Charles LNG export development, supported by about US$6.20 billion in year-to-date cash generation and plans for 3% to 5% annual distribution increases.
• This combination of large-scale expansion and a targeted distribution growth framework points to a company leaning on financial flexibility to balance reinvestment with higher income payments to unitholders.
• Next, we’ll examine how Energy Transfer’s planned 3% to 5% annual distribution increases reshape its investment narrative for income-focused investors.

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Energy Transfer Investment Narrative Recap

An investor in Energy Transfer needs to believe that large, long-life natural gas and NGL infrastructure will stay well utilized as power and data center demand rises, and that these assets can support a high, slowly growing payout. The latest update on nearly US$10.00 billion of projects and strong year-to-date cash generation reinforces that story, but also sharpens the near term focus on execution risk around big-ticket builds like Lake Charles LNG and new Permian pipelines.

The announcement that Energy Transfer plans 3% to 5% annual distribution increases is especially relevant here, because it ties the company’s investment case directly to the success of this multiyear growth backlog. As projects such as the Desert Southwest and Hugh Brinson pipelines and Lake Charles LNG move through permitting and construction, the ability to sustain both growth spending and higher cash distributions will likely hinge on how well Energy Transfer manages timing, costs and contract coverage across this expanding portfolio.

Yet alongside this income growth framework, investors should also be aware of the risk that large, multi-billion-dollar projects can face cost overruns and regulatory delays that...

Read the full narrative on Energy Transfer (it's free!)

Energy Transfer's narrative projects $99.8 billion revenue and $6.7 billion earnings by 2028. This requires 7.4% yearly revenue growth and a $2.2 billion earnings increase from $4.5 billion today.

Uncover how Energy Transfer's forecasts yield a $21.55 fair value, a 31% upside to its current price.

Exploring Other Perspectives

Twenty-two fair value estimates from the Simply Wall St Community span roughly US$15.50 to US$43.60, showing how far apart individual views can be. When you set those against the heavy reliance on large, multi-year pipeline and LNG projects, it underlines why many investors look at several perspectives before forming a view on Energy Transfer’s outlook.

Explore 22 other fair value estimates on Energy Transfer - why the stock might be worth 6% less than the current price!

Build Your Own Energy Transfer Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Energy Transfer research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Energy Transfer research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Energy Transfer's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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