RBC Capital Markets has adjusted its outlook on Williams Companies (NYSE: NYSE:WMB), a leading energy infrastructure company. The firm increased the stock's price target to $47.00, up from the previous target of $44.00, while reiterating an Outperform rating.
The revision follows the company's recent second-quarter 2024 earnings report and the details provided in its 10Q filing. Despite the ongoing challenges posed by weak natural gas prices, Williams Companies is expected to hit the higher end of its 2024 adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) guidance.
The company's performance is anticipated to benefit from increased dry gas production and positive results from its marketing segment. These factors could potentially lead to financial results that exceed current expectations.
RBC Capital Markets also highlighted the significance of Williams Companies' current project backlog, which is poised to stimulate growth throughout the company. Furthermore, the firm underscored the potential for meaningful long-term growth opportunities, which are likely to be supported by increasing power demand.
In other recent news, Williams Companies has successfully raised $1.5 billion through a multi-tranche notes offering, strengthening its financial structure for long-term capital operations.
The company has also reported record second-quarter earnings, notably in the Transmission and Storage segment, demonstrating resilience amidst fluctuating natural gas prices. Market research firm CFRA has maintained a Hold rating on Williams Companies, while raising their price target to $42.00, based on a 10.5x multiple of enterprise value to projected 2025 EBITDA.
Despite facing a legal challenge over its $1 billion Regional Energy Access project, Williams Companies continues to expand operations in Louisiana and parts of the Marcellus shale region. The company maintains its financial guidance through 2025, projecting a 6.5% growth in EBITDA.
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