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Energy Transfer Stock Is at a 52-Week Low

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Dec. 4 2020, Updated 10:53 a.m. ET

What’s next for Energy Transfer?

Energy Transfer (ET) stock continues to trade weak. The stock hit a new 52-week low of $12.75 on December 18. Currently, the stock is trading in the oversold zone with its RSI (relative strength index) at 26. An extreme RSI value can imply an impending reversal in a stock’s direction.

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Moving averages

Energy Transfer stock is trading at $12.94—almost 15% and 21% below its 50-day and 200-day simple moving average levels, respectively. The large discount to both of these levels indicates weakness in the stock. In the short term, the levels around $15.21 and $16.47 will likely act as a resistance for the stock.

We highlighted the impending weakness in Energy Transfer stock indicated by the “death cross” pattern in Energy Transfer Stock: Is More Weakness Coming? on November 27. Since then, the stock has fallen more than 10%.

The weakness in crude oil prices has influenced Energy Transfer stock. Since October, crude oil has fallen more than 35%, while Energy Transfer stock has lost almost 30%. The energy (XLE) sector has fallen 23% during the same period.

According to analysts’ estimates, Energy Transfer stock has a median target price of $22.12—compared to its current market price of $12.94, which implies an upside potential of 71% for the next 12 months. The estimated upside and a healthy distribution yield of 8.5% offer a strong total return potential going forward.

Many MLPs (AMLP) are offering attractive potential upside for the next year given their steep fall. To learn more, read MLPs: Analyzing the Opportunities Ahead.

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