Williams Co (WMB) AI Stock Analysis

• Market Cap: $66.61B
• Dividend Yield: 3.51%
• Average Volume (3M): 8.16M
• Price to Earnings (P/E): 30.0
• Beta (1Y): 0.75
• Revenue Growth: 8.06%
• EPS Growth: -30.11%
• Country: US
• Employees: 5,829
• Sector: Energy
• Sector Strength: 62
• Industry: Oil & Gas Midstream
• EPS (TTM): 1.82
• Shares Outstanding: 1,220,685,700
• 10 Day Avg. Volume: 8,412,355
• 30 Day Avg. Volume: 8,159,482
• PEG Ratio: 3.78
• Price to Book (P/B): N/A
• Price to Sales (P/S): 6.83
• Price to Cash Flow (P/CF): 14.90
• P/FCF Ratio: 10.60
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $61.86
• Price Target Upside: 13.86% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

Williams Co's strong financial performance, optimistic earnings outlook, and strategic corporate events support a positive overall stock score. However, challenges such as declining revenue and high P/E valuation slightly temper the outlook.

Positive Factors

Growth Strategy

WMB raises its 2025 growth capex estimate significantly, showing strong commitment to future growth.

Project Expansion

WMB is constructing a gas pipeline plus power generation project to serve a data center under a 10-year contract.

Negative Factors

Contract Concerns

The BTM project is backed by a 10-year fixed price power purchase agreement, which is shorter than the 15-year contract investors expected.

Financial Performance

Free cash flow per share was below estimates due to higher dividends paid to non-controlling interests, resulting in a cash shortfall.

Williams Co Business Overview & Revenue Model

Company Description

The Williams Companies, Inc., together with its subsidiaries, operates as an energy infrastructure company primarily in the United States. It operates through Transmission & Gulf of Mexico, Northeast G&P, West, and Gas & NGL Marketing Services segments. The Transmission & Gulf of Mexico segment comprises Transco and Northwest natural gas pipelines; and natural gas gathering and processing, and crude oil production handling and transportation assets in the Gulf Coast region, as well as various petrochemical and feedstock pipelines. The Northeast G&P segment engages in the midstream gathering, processing, and fractionation activities in the Marcellus Shale region primarily in Pennsylvania and New York, and the Utica Shale region of eastern Ohio. The West segment comprises gas gathering, processing, and treating operations in the Rocky Mountain region of Colorado and Wyoming, the Barnett Shale region of north-central Texas, the Eagle Ford Shale region of South Texas, the Haynesville Shale region of northwest Louisiana, and the Mid-Continent region, which includes the Anadarko, Arkoma, and Permian basins; and operates natural gas liquid (NGL) fractionation and storage facilities in central Kansas near Conway. The Gas & NGL Marketing Services segment provides wholesale marketing, trading, storage, and transportation of natural gas for natural gas utilities, municipalities, power generators, and producers; risk and asset management; and NGL marketing services. The company owns and operates 30,000 miles of pipelines, 29 processing facilities, 7 fractionation facilities, and approximately 23 million barrels of NGL storage capacity. The Williams Companies, Inc. was founded in 1908 and is headquartered in Tulsa, Oklahoma.

How the Company Makes Money

Williams Co generates revenue through its extensive network of natural gas pipelines, primarily by charging fees for the transportation of natural gas. The company also earns income from its processing and storage facilities by providing essential services to producers and consumers of natural gas. Key revenue streams include long-term, fee-based contracts that ensure stable cash flow and reduce exposure to commodity price volatility. Additionally, strategic partnerships with other energy companies and investments in infrastructure expansion contribute to Williams Co's earnings by enhancing its capacity and market reach.

Williams Co Financial Statement Overview

Summary

Williams Co shows robust profitability and operational efficiency, with strong profit margins and effective cost management. However, the decline in revenue and free cash flow growth raises concerns about future growth potential. The balance sheet reflects moderate leverage that needs careful monitoring.

Income Statement

Williams Co displayed strong gross and net profit margins in 2024, with a gross profit margin of 80.24% and a net profit margin of 21.18%. However, the revenue growth rate was negative at -3.71% compared to 2023, indicating a decline in sales. EBIT and EBITDA margins were robust at 31.79% and 35.42%, respectively, underscoring effective cost management despite the revenue dip.

Balance Sheet

Williams Co maintains a stable balance sheet with a debt-to-equity ratio of 2.16, reflecting moderate leverage. The return on equity was strong at 17.89%, showcasing efficient use of equity to generate profits. However, the equity ratio stood at 22.80%, indicating a higher reliance on debt, which could pose risks in a volatile market.

Cash Flow

The company experienced a decrease in free cash flow growth of -28.77% in 2024, but maintained a healthy operating cash flow to net income ratio of 2.23, indicating strong cash generation capability. The free cash flow to net income ratio was 1.08, suggesting reasonable cash flow coverage of earnings.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
10.50B	10.91B	10.96B	10.63B	7.72B
	Gross Profit
8.43B	6.80B	3.68B	3.21B	3.06B
	EBIT
3.34B	4.31B	3.02B	2.63B	2.20B
	EBITDA
6.57B	7.77B	5.70B	5.09B	4.58B
	Net Income Common Stockholders
2.23B	3.18B	2.05B	1.52B	211.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
60.00M	2.15B	152.00M	1.68B	142.00M
	Total Assets
54.53B	52.63B	48.43B	47.61B	44.16B
	Total Debt
26.94B	26.46B	22.90B	23.68B	22.34B
	Net Debt
26.88B	24.31B	22.75B	22.00B	22.20B
	Total Liabilities
39.69B	37.74B	34.39B	33.51B	29.58B
	Stockholders Equity
12.44B	12.40B	11.48B	11.42B	11.77B
Cash Flow		Free Cash Flow
2.40B	3.37B	2.61B	2.70B	2.22B
	Operating Cash Flow
4.97B	5.94B	4.89B	3.94B	3.50B
	Investing Cash Flow
-4.86B	-3.89B	-3.38B	-1.47B	-1.56B
	Financing Cash Flow
-2.20B	-49.00M	-3.04B	-942.00M	-2.08B

Williams Co Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 54.33
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WMB, the sentiment is Negative. The current price of 54.33 is below the 20-day moving average (MA) of 58.47, below the 50-day MA of 56.88, and above the 200-day MA of 50.69, indicating a neutral trend. The MACD of 1.09 indicates Negative momentum. The RSI at 63.04 is Neutral, neither overbought nor oversold. The STOCH value of 45.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WMB.

Williams Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MPLX	85 Outperform	$49.57B	11.52	31.78%	7.45%	4.30%	10.45%
ET	77 Outperform	$55.45B	12.58	13.40%	8.10%	5.20%	18.35%
EPD	77 Outperform	$66.81B	11.58	20.78%	7.05%	12.71%	6.74%
WMB	71 Outperform	$66.61B	30.03	17.92%	3.51%	8.06%	-30.11%
KMI	71 Outperform	$56.19B	21.61	8.54%	4.55%	-0.55%	10.02%
OKE	66 Neutral	$50.51B	15.63	18.11%	4.95%	24.16%	-6.58%
Sector *	57 Neutral	$7.52B	4.07	-3.52%	8.38%	-0.14%	-64.60%

Williams Co Corporate Events

Williams Co Announces COO Retirement in 2025

On March 13, 2025, Williams announced that Micheal G. Dunn, Executive Vice President and Chief Operating Officer, will retire on May 2, 2025. During his tenure, Dunn transformed the company into a cohesive operating entity, completed significant infrastructure projects, and enhanced regulatory compliance, positioning Williams to continue its natural gas-focused strategy. Efforts are underway to find a suitable successor, with Dunn participating in the process.

Williams Co Announces Major Power Infrastructure Agreement

On February 28, 2025, Williams Co entered into a significant agreement with a large investment-grade company to provide natural gas and power generation infrastructure, investing approximately $1.6 billion. This project, expected to complete in the second half of 2026, marks Williams Co’s first power innovation project, backed by a 10-year fixed-price power purchase agreement, and raises its 2025 growth capex by $925 million, impacting its leverage ratio.

Williams Co’s Public Offering for Financial Stability

Williams announced the pricing of a $1.5 billion public offering of senior notes, split between $1.0 billion in 5.600% notes due 2035 and $500 million in 6.000% notes due 2055. The proceeds from the offering will be used to repay commercial paper, address near-term debt maturities, and support general corporate purposes, positioning the company for improved financial stability and operational flexibility.