Key Stats — Energy Transfer LP (ET) | Q4 2025
- Current price: ~$19
- Q4 2025 total revenue: $25.3B (+30% YoY)
- Q4 2025 adjusted EBITDA: ~$4.2B (+8% YoY)
- Full-year 2025 adjusted EBITDA: ~$16B (+3% YoY, partnership record)
- Full-year 2025 DCF (attributable to partners, as adjusted): $8.2B
- 2026 adjusted EBITDA guidance: $17.45B–$17.85B (raised from $17.3B–$17.7B)
- Distribution growth target: 3%–5% annually (long-term)
- TIKR model target price: $50.31 (mid case, realized 12/31/30)
- Implied upside: ~+165% over ~5 years (~23% annualized)
Energy Transfer Stock Hits Record EBITDA as Q4 Revenue Surges 30%
Energy Transfer stock (ET) closed Q4 2025 with adjusted EBITDA of approximately $4.2 billion, up roughly 8% from the same period last year, capping a full-year 2025 that set a partnership record at nearly $16 billion in adjusted EBITDA.
The intrastate natural gas segment was the standout for the quarter, with adjusted EBITDA rising to $355 million from $263 million in Q4 2024, a jump of roughly 35%, driven by increased pipeline and storage optimization and higher volumes across ET’s Texas intrastate system from third-party volume growth.
The interstate natural gas segment also contributed meaningfully, posting adjusted EBITDA of $523 million versus $493 million in the year-ago quarter, reflecting more capacity sold and higher utilization on Panhandle Eastern, Trunkline, Florida Gas, and Transwestern.
The NGL and refined products segment held flat at $1.1 billion quarter over quarter, with a onetime $56 million regulatory order benefit offset by $58 million of lower hedge gains tied to NGL inventory settlement timing and a $14 million impact from fog-related loading delays at the Nederland terminal. According to Co-Chief Executive Officer Thomas Long on the Q4 earnings call, both the $58 million and the $14 million impacts are expected to be recovered in Q1 2026.
The crude segment came in at $722 million, down from $760 million in Q4 2024, as lower Bakken transportation revenues outweighed growth across several other crude pipeline systems and the Permian Basin gathering operation.
Full-year 2025 organic growth capital came in at approximately $4.5 billion, concentrated in NGL and refined products, midstream, and intrastate segments, excluding SUN and USA Compression.
Energy Transfer raised its 2026 adjusted EBITDA guidance to a range of $17.45 billion to $17.85 billion, up from the prior range of $17.3 billion to $17.7 billion. The revision reflects the January 2026 close of USA Compression’s acquisition of J-W Power Company. The company maintained its long-term distribution growth target of 3% to 5% annually and a leverage target of 4x to 4.5x EBITDA.
On the growth pipeline, the Hugh Brinson project is approximately 75% through mainline construction as of the call, with 100% of pipe delivered, Phase 1 expected in service Q4 2026, and some early volumes potentially flowing ahead of that date. The Desert Southwest pipeline was upsized from 42 inches to 48 inches in December, expanding capacity to up to 2.3 Bcf per day and carrying an expected cost of approximately $5.6 billion, with a Q4 2029 in-service target.
Energy Transfer Stock: What the Income Statement Shows
Energy Transfer stock’s Q4 2025 income statement reflects a low-margin, high-throughput midstream model where the operating story is volume scale and EBITDA efficiency rather than traditional margin expansion.
Q4 2025 gross profit came in at $4.4 billion, up 8% year over year, with gross margin at 17.6%, down from 21% in Q4 2024.
The gross margin compression from 21% to 18% quarter over quarter tracks the revenue surge: Q4 2025 total revenues of $25.3 billion were up 30% from $19.5 billion in Q4 2024, a mix of higher commodity-linked revenues that carry lower incremental margins.
Operating income landed at $2.35 billion in Q4 2025, up 3% from $2.28 billion in Q4 2024, with operating margin at 9.3% versus 11.7% in the year-ago period.
The margin trajectory over the trailing eight quarters has been relatively range-bound, with operating margin oscillating between roughly 9% and 12%, reflecting ET’s contract-heavy, fee-based structure rather than commodity spread sensitivity.
Valuation Model Take
The TIKR model prices Energy Transfer stock at $50.31 under the mid-case scenario, implying roughly +165% total return from the current price of ~$19 over approximately 4.7 years, which annualizes to about 23%.
The mid-case assumptions are a revenue CAGR of 4.3% through 2035 and a net income margin of 5.6%, modest targets for a partnership that just recorded a full-year EBITDA record and has $5 billion to $5.5 billion in organic growth capital deploying in 2026 alone.
This earnings report reinforces the investment case without resolving it: record EBITDA is confirmed, the growth backlog is expanding, and the Oracle data center agreement has begun flowing. What remains unpriced at $19 is the compounding effect of Hugh Brinson, Desert Southwest, Frac IX, and the Marcus Hook ethane expansion all reaching revenue contribution between 2026 and 2029.
Energy Transfer stock looks materially undervalued relative to the mid-case TIKR target, and the Q4 2025 print does not weaken that view.
The real question for Energy Transfer stock is whether $5B-plus in annual growth CapEx converts cleanly into EBITDA growth at the pace the valuation model requires, or whether execution risk and commodity volatility blunt the return.
What Has to Go Right
- Hugh Brinson Phase 1 delivers early volumes in 2026, opening Permian egress ahead of schedule and capturing Waha-to-market spread on 160,000 Mcf per day of open capacity
- The Oracle data center agreement and the three Oklahoma power plant connections (approximately 190 MMcf per day, expected Q2 2026) ramp on schedule, layering fee-based revenue onto underutilized pipe
- Desert Southwest reaches FID milestones on the road to Q4 2029 in-service, with contracted demand from utilities and data centers already supporting the 48-inch upsize
- Frac IX at Mont Belvieu and Mustang Draw I and II plants (Q2 and Q4 2026 in-service) begin contributing to NGL EBITDA, lifting ET’s affiliate volume mix above 60%
What Could Still Go Wrong
- The $72 million in Q4 hedge timing losses and Nederland fog impacts recover as guided in Q1 2026, but any further one-time drag from weather, regulatory, or construction delays would pressure the clean quarterly run rate
- NGL fractionation rates face competitive pressure as Mackie McCrea acknowledged on the call: the segment is “heading toward an overbuild,” which could compress third-party contracting economics for Frac IX
- The Lake Charles LNG suspension removes a long-cycle revenue option; if no third-party buyer emerges or the terminal is repurposed at lower returns, the capital deployed there earns less than the original thesis assumed
- Leverage maintained at 4x to 4.5x EBITDA during a $5B-plus annual CapEx cycle leaves limited cushion if EBITDA growth lags the project-in-service ramp by even one or two quarters
Should You Invest in Energy Transfer LP?
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