WMB Underperformed AMLP and SPY Last Week: Can It Bounce Back?


May. 30 2017, Published 4:41 p.m. ET

Williams Companies’ weekly performance

Williams Companies (WMB) had a positive start to last week. However, it entered negative territory following its plunge later in the week. WMB ended the week with a 1.7% decline compared to the previous week. At the same time, the Alerian MLP ETF (AMLP), which comprises of 25 energy MLPs, was down 0.7%, whereas the SPDR S&P 500 ETF (SPY) was up 1.4%. WMB underperformed AMLP and SPY by 100 basis points and 310 basis points, respectively. The energy sector forms ~6.6% of the S&P 500 Index (SPX-INDEX).

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Williams Companies’ YTD performance

WMB has lost 4.7% YTD (year-to-date). In comparison, TransCanada (TRP) has risen 4.1%, while Enterprise Products Partners (EPD) has lost 0.6%. AMLP has lost 3.3% in 2017. WMB’s MLP subsidiary, Williams Partners (WPZ), has gained 5.5%.

WMB hasn’t entered positive territory since its crash after the announcement in regards to its financial repositioning, which included the removal of IDRs from Williams Partners’ capital structure, conversion of the economic GP (general partner) interest in WPZ to non-economic GP interest, and WPZ’s distribution cut.

Series overview

In this series, we’ll try to find out whether WMB can gain upward momentum from here. We’ll look into WMB’s technical indicators including moving averages and implied volatility. Following this, we’ll look into WMB’s valuation and analyst projections.


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