Back to top

Image: Bigstock

2 Energy Stocks Likely to Benefit From MVP's Operational Launch

Read MoreHide Full Article

The Federal Energy Regulatory Commission (“FERC”) has granted authorization for the Mountain Valley Pipeline (“MVP”) to commence operations, marking a significant development in the Oil/Energy sector. Spanning 303 miles, MVP has the capacity to transport up to 2.0 billion cubic feet per day (Bcf/d) of natural gas from Wetzel County, WV, to an interconnection point with Transcontinental Gas Pipeline’s (Transco) compressor station 165 in Pittsylvania County, VA. Transco, an extensive interstate transmission system, facilitates natural gas delivery across a 10,000-mile network from South Texas to New York.

MVP's operational green light by FERC signifies a milestone. With long-term agreements in place with various shippers for 20 years, MVP is set to facilitate natural gas movement from the Appalachian Basin to key markets in the Northeast, mid-Atlantic and Southeastern United States. This not only enhances regional energy security but also opens lucrative avenues for gas suppliers to tap into high-demand regions.

As the current operator of MVP, Equitrans Midstream Corporation (ETRN - Free Report) should directly benefit from the pipeline's operations. The long-term agreements and strategic market connections are expected to enhance Equitrans' revenues and profitability significantly.

2 Stocks to Keep an Eye on

The commencement of MVP operations not only promises to enhance regional energy infrastructure but also sets the stage for sustained growth in natural gas transportation. For EQT Corporation (EQT - Free Report) and The Williams Companies, Inc. (WMB - Free Report) , strategic alignments with MVP are expected to yield long-term benefits, positioning these entities favorably amid evolving energy market dynamics. Both companies carry a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

EQT: As a prominent natural gas producer in the highly productive Appalachian Basin, the company is strategically positioned to capitalize on the increasing demand for clean energy. EQT is acquiring Equitrans Midstream, the operator of MVP. The transaction, expected to close during the fourth quarter of 2024, should make EQT a vertically integrated natural gas business in the Appalachian Basin, enhancing its production and transportation capabilities. The commencement of MVP operations will likely increase the value of this acquisition, positively impacting EQT's stock price.

The Zacks Consensus Estimate for 2025 earnings per share (EPS) indicates 254.8% growth over 2024. The company’s current market cap is roughly $17.37 billion.

Williams Companies: It is a premier energy infrastructure provider in North America. The company’s core operations include finding, producing, gathering, processing, and transporting natural gas and natural gas liquids. Boasting a widespread pipeline system of more than 33,000 miles, Williams is one of the largest domestic transporters of natural gas by volume. WMB owns the Transcontinental Gas Pipeline (Transco), which will connect with the MVP at Transco's compressor station 165. This interconnection will likely increase the volume of natural gas transported through Transco, boosting Williams' revenues and indirectly benefiting its stock price.

The Zacks Consensus Estimate for 2025 EPS indicates 13.63% growth over 2024. Its current market cap is roughly $50.18 billion.

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Williams Companies, Inc. (The) (WMB) - free report >>

EQT Corporation (EQT) - free report >>

Equitrans Midstream Corporation (ETRN) - free report >>

Published in