Williams (WMB, Financial) has announced the appointment of Larry Larsen as Executive Vice President and Chief Operating Officer, effective May 3, 2025. Larsen will take charge of the company's transmission, storage, gathering, and processing operations. He steps into the role following the retirement of Michael Dunn, who revealed his plans to leave the company last month.
Larsen, who currently holds the position of Senior Vice President of Gathering and Processing at Williams, is recognized for his comprehensive understanding of the company's operations and strategic direction, which are primarily focused on natural gas. His extensive experience is expected to facilitate a smooth leadership transition and bolster Williams' ongoing optimization efforts. This appointment is seen as a strategic move to maintain and enhance Williams' competitive edge and to support the continued execution of its long-term growth plans.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 19 analysts, the average target price for Williams Companies Inc (WMB, Financial) is $60.44 with a high estimate of $74.00 and a low estimate of $41.76. The average target implies an upside of 1.40% from the current price of $59.61. More detailed estimate data can be found on the Williams Companies Inc (WMB) Forecast page.
Based on the consensus recommendation from 23 brokerage firms, Williams Companies Inc's (WMB, Financial) average brokerage recommendation is currently 2.3, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Williams Companies Inc (WMB, Financial) in one year is $38.37, suggesting a downside of 35.63% from the current price of $59.61. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Williams Companies Inc (WMB) Summary page.
WMB Key Business Developments
Release Date: February 13, 2025
- Adjusted EBITDA: $7.08 billion in 2024, a 4% increase over 2023, exceeding original guidance by $130 million.
- Adjusted EPS: Finished above the high end of original guidance for 2024.
- Available Funds from Operations (AFFO) per Share: Exceeded high end of original guidance for 2024; projected to grow at a 9% five-year CAGR.
- Dividend Growth: 5% five-year CAGR, maintaining strong dividend coverage.
- Leverage Improvement: 18% improvement over the last five years, with 2025 leverage forecasted close to the low end of the target range (3.5 to 4 times).
- 2025 Adjusted EBITDA Guidance: Midpoint increased to $7.65 billion, an 8% growth over 2024.
- 2025 AFFO per Share Guidance: Increased to $4.50, covering expected $2 per share dividend about 2.25 times.
- Growth CapEx Guidance for 2025: $1.8 billion, excluding acquisitions.
- Cash Return on Invested Capital (2018-2023): Nearly 23%, driving a 26% reduction in leverage.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Williams Companies Inc (WMB, Financial) reported a record adjusted EBITDA for the 12th consecutive year, demonstrating resilience despite low natural gas prices.
- The company successfully executed large-scale expansion projects, including the Southside Reliability Enhancement project and the Regional Energy Access project, which are running at full contracted capacity.
- Williams Companies Inc (WMB) announced six new transmission projects and optimized its asset portfolio by consolidating interests in the deepwater discovery system and the Wamsutter upstream joint venture.
- The company is advancing a 10 Bcf capacity expansion at its Gulf Coast storage facility to support industrial, power generation, and LNG demand.
- Williams Companies Inc (WMB) has a strong balance sheet and has not issued equity to fuel growth, maintaining a 14% compound annual growth rate in EPS over the past five years.
Negative Points
- Producer customer delays have unfavorably impacted the expected ramp in growth projects in the deepwater, affecting earnings expectations.
- The company faces challenges with supply chain constraints around turbines, which could limit the scalability of behind-the-meter power generation projects.
- Despite a positive outlook, there is uncertainty around the restoration of 100% bonus depreciation and potential changes in corporate alternative minimum tax legislation.
- Williams Companies Inc (WMB) remains conservative in its guidance for gathering and processing volumes, reflecting cautious producer activity despite higher gas prices.
- The company acknowledges potential limitations in expanding its capital expenditure due to a commitment to not stretching the balance sheet or issuing equity.
