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Can Williams Bounce Back from Its November Losses?

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Williams Companies’ recent performance

William Companies (WMB) stock has been very weak over the recent trading session. The C corporation GP (general partner) of Williams Partners (WPZ) is currently trading close to its 15-month low of $27.5. It has lost 4.5% since the start of this month. At the same time, the Alerian MLP ETF (AMLP), which consists of 25 energy MLPs (master limited partnerships), has lost 4.4%.

WMB’s recent sluggishness could be attributed to the general pessimism in the midstream sector, the recent roadblock in Atlantic Sunrise project, and slight weakness in Marcellus drilling activity. According to Baker Hughes, the rig count in the Marcellus region has fallen to 42 as of November 10, 2017, compared with 47 by the end of 3Q17—a decline of five rigs. Williams Partners is one of the largest natural gas gatherers in the region.

WMB’s YTD performance

The recent weakness has pushed Williams Companies to a new 52-week low. It has now lost ~13% in 2017 to date. AMLP has lost 19.4% since the beginning of this year, and so Williams Companies is outperforming AMLP by ~600 basis points.

Peers Energy Transfer Equity (ETE) and Enterprise Products Partners (EPD) have fallen 13.3% and 10.2%, respectively, so far this year.

Stock in news

Williams Partners’ Atlantic Sunrise project recently had to face some roadblocks. The FERC authorization of the project was put on a temporary stay. According to the related press release, the temporary stay was a result “of a lawsuit against the FERC for not further extending a comprehensive four-year permitting process.” However, the construction has now resumed after a US court denied the “Opponents’ Emergency Stay Request.”

Series overview

In this series, we’ll try to find out whether WMB can bounce back from here. We’ll look into WMB’s technical indicators and assess WMB’s valuation and analyst recommendations.

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