Williams Co (WMB) AI Stock Analysis

• Market Cap: $70.07B
• Dividend Yield: 3.39%
• Average Volume (3M): 6.59M
• Price to Earnings (P/E): 28.9
• Beta (1Y): 0.57
• Revenue Growth: 10.57%
• EPS Growth: -14.22%
• Country: US
• Employees: 5,829
• Sector: Energy
• Sector Strength: 66
• Industry: Oil & Gas Midstream
• EPS (TTM): 0.46
• Shares Outstanding: 1,221,177,400
• 10 Day Avg. Volume: 5,840,082
• 30 Day Avg. Volume: 6,588,831
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.53
• Enterprise Value/Revenue: 9.54
• Enterprise Value/Gross Profit: 17.85
• Enterprise Value/Ebitda: 15.34
• 1Y Price Target: $66.29
• Price Target Upside: 15.13% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 15

• Rating: 70 Outperform
• Price Target: $64.00 ▲(11.15% Upside)

Williams Co's strong earnings call performance and financial growth prospects are the most significant factors driving the score. Despite a high debt-to-equity ratio and challenges in cash flow, the company's strategic project completions and upward guidance revisions provide a positive outlook. The technical indicators suggest a neutral market sentiment, while the valuation indicates the stock is relatively expensive, balanced by a reasonable dividend yield.

Positive Factors

Earnings

WMB raised its full year EBITDA guidance by $50MM, slightly above Consensus and estimates, surprising investors who expected guidance to be maintained.

Growth Prospects

WMB is projected to grow its EBITDA at an 11% compound annual growth rate over the next three years, which is significantly higher than industry guidance and consensus.

Project Advancement

The Northeast Supply Enhancement project is expected to be completed earlier than anticipated, with potential cost savings of $150 million improving its economics.

Negative Factors

Project Announcements

The two large announcements investors are waiting for material progress on didn’t materialize on this call.

Project Backlog

Currently only has enough in backlog to hit 5.5% EBITDA growth, and thus needs to add ~$3B of capex into the backlog relatively soon.

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 primarily through the transportation and processing of natural gas and natural gas liquids. The company operates an extensive network of pipelines that facilitate the movement of these energy products from production sites to various markets. Key revenue streams include fees charged for the transportation of natural gas, which are typically based on the volume transported and the distance covered. Additionally, WMB earns revenue from processing natural gas to separate valuable byproducts, such as ethane and propane, which are sold to various industrial customers. Significant partnerships with major energy producers and utilities enhance the company's earnings potential, as they secure long-term contracts and commitments for pipeline capacity, providing a stable cash flow. Furthermore, the company's strategic investments in infrastructure projects and its ability to adapt to market dynamics contribute to its overall financial performance.

Williams Co Financial Statement Overview

Summary

Williams Co exhibits strong revenue growth and profitability, with efficient cost management reflected in high gross and EBIT margins. However, the high debt-to-equity ratio indicates significant leverage, which could pose financial risks. Cash flow metrics show a decline in free cash flow, highlighting the need for careful cash management. Overall, the company is performing well but should focus on reducing leverage and improving cash flow stability.

Income Statement

Williams Co has demonstrated consistent revenue growth, with a TTM revenue growth rate of 2.9%. The gross profit margin remains strong at 75.1%, indicating efficient cost management. However, the net profit margin has slightly decreased to 21.6% from the previous year. The EBIT and EBITDA margins are robust, reflecting strong operational performance, though there is a slight decline in margins compared to previous periods.

Balance Sheet

The company's debt-to-equity ratio is relatively high at 2.30, indicating significant leverage, which could pose risks if not managed properly. Return on equity is healthy at 19.5%, showing effective use of equity to generate profits. The equity ratio stands at 22.1%, suggesting a balanced asset structure but with room for improvement in reducing leverage.

Cash Flow

Operating cash flow remains strong, but the free cash flow has decreased by 10.6% in the TTM period. The operating cash flow to net income ratio is 0.89, indicating good cash generation relative to net income. However, the free cash flow to net income ratio has declined to 0.35, suggesting potential challenges in maintaining free cash flow levels.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	11.21B	10.50B	10.91B	10.96B	10.63B	7.72B
Gross Profit	5.99B	6.17B	6.80B	5.50B	4.75B	4.38B
EBITDA	6.97B	6.57B	7.71B	5.70B	5.09B	3.17B
Net Income	2.43B	2.23B	3.18B	2.05B	1.52B	211.00M
Balance Sheet
Total Assets	56.14B	54.53B	52.63B	48.43B	47.61B	44.16B
Cash, Cash Equivalents and Short-Term Investments	903.00M	60.00M	2.15B	152.00M	1.68B	142.00M
Total Debt	28.57B	26.94B	26.46B	22.90B	23.68B	22.34B
Total Liabilities	41.34B	39.69B	37.74B	34.39B	33.51B	29.58B
Stockholders Equity	12.44B	12.44B	12.40B	11.48B	11.42B	11.77B
Cash Flow
Free Cash Flow	1.88B	2.40B	3.37B	2.61B	2.70B	2.22B
Operating Cash Flow	5.34B	4.97B	5.94B	4.89B	3.94B	3.50B
Investing Cash Flow	-4.02B	-4.86B	-3.89B	-3.38B	-1.47B	-1.56B
Financing Cash Flow	-473.00M	-2.20B	-49.00M	-3.04B	-942.00M	-2.08B

Williams Co Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 57.58
• 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 Neutral. The current price of 57.58 is above the 20-day moving average (MA) of 57.47, below the 50-day MA of 58.43, and above the 200-day MA of 57.19, indicating a neutral trend. The MACD of -0.23 indicates Negative momentum. The RSI at 47.97 is Neutral, neither overbought nor oversold. The STOCH value of 62.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for WMB.

Williams Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MPLX	81 Outperform	$51.94B	12.10	31.38%	7.53%	4.67%	2.07%
EPD	80 Outperform	$69.29B	11.96	20.43%	6.73%	-0.55%	2.14%
ET	75 Outperform	$60.76B	13.66	13.73%	7.39%	-3.65%	9.69%
WMB	70 Outperform	$70.07B	28.95	19.64%	3.39%	10.57%	-14.22%
KMI	70 Outperform	$59.35B	21.93	8.86%	4.34%	3.95%	11.32%
LNG	68 Neutral	$52.93B	14.04	68.91%	0.84%	11.20%	-8.80%
Sector *	66 Neutral	$15.26B	7.30	3.22%	5.27%	4.16%	-60.82%

Williams Co Corporate Events

Williams Co Announces $1.5 Billion Senior Notes Offering

On June 26, 2025, Williams Co announced the pricing of a $1.5 billion public offering of senior notes, with $750 million due in 2030 and another $750 million due in 2035. The proceeds from this offering are intended to repay near-term debt maturities and support general corporate purposes, potentially impacting the company’s financial stability and market position.