Key Points
Energy Transfer is a major "midstream" energy company.
It's poised to reward long-term investors -- especially via its fat dividend yield.
Energy Transfer LP (TXSE: ET) is a "midstream" energy company. "Upstream" companies focus on exploring and producing oil and/or gas, while "downstream" companies focus on refining and selling it. Midstream businesses connect those companies -- via moving, storing, and processing oil and/or gas.
Image source: Getty Images.
Missed AI’s "Act 1"? Act 2 Could Be 15x Bigger. Most investors think they missed the AI boat because they didn't buy Nvidia in 2005. But according to our analysts, we’re only at the end of "Act 1"—the R&D phase. "Act 2" is the global rollout. Continue »
Here's its performance in recent years:
Period |
Average Annual Total Gain |
|---|---|
Past 3 years |
18.79% |
Past 5 years |
20.05% |
Past 10 years |
6.46% |
Past 15 years |
9.39% |
Source: Morningstar.com, as of Oct. 20, 2026. Total gain includes dividend reinvestment.
And here's how those numbers would have increased a $1,000 investment:
- $1,000 would have grown to $1,676 over the past three years.
- $1,000 would have grown to $2,494 over the past five years.
- $1,000 would have grown to $1,870 over the past 10 years.
- $1,000 would have grown to $3,843 over the past 15 years.
Looking forward, not back
Investors should spend more time looking forward than back, though. So ... is Energy Transfer a company worth investing in now? Let's take a look.
It boasts about 140,000 miles of pipeline and related infrastructure, spanning 44 states and present in all of America's major production basins.
It's growing and plans to keep growing -- in part via acquisitions. For example, it recently struck a deal to buy Vaquero Midstream for about $2.6 billion. Vaquero brings a 300-mile pipeline, several gas-processing trains, and, importantly, long-term, fee-based contracts -- which can provide reliable cash flow for about the next decade.
An especially attractive thing about Energy Transfer is its dividend yield -- recently a whopping 7%! It cut its payout back in 2020 to restructure itself a bit, but it's been increasing it again -- for nearly 20 quarters in a row.
Note, too, that Energy Transfer is a master limited partnership (MLP), so it gets treated a little differently come tax time. If you own it, you'll need to file a K-1 tax form.
Give Energy Transfer some consideration for your long-term portfolio -- after learning more about it, of course.
Selena Maranjian has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.