BMO Capital initiates Williams Companies stock with Outperform rating

Published 18/09/2025, 22:06
BMO Capital initiates Williams Companies stock with Outperform rating

Investing.com - BMO Capital initiated coverage on Williams Companies (NYSE:WMB) with an Outperform rating and a price target of $66.00 on Thursday. The stock, currently trading near its 52-week high of $63.45, has demonstrated strong momentum with a 35% return over the past year.

The firm views Williams Companies as one of the most attractive natural gas-focused midstream operators, citing its robust financial outlook that offers both growth and income potential. InvestingPro data shows the company maintains a "GOOD" financial health score, supported by strong profitability metrics and steady cash flows.

BMO Capital estimates an 8% EBITDA compound annual growth rate (CAGR) for Williams Companies from 2024 to 2029, exceeding the company’s long-term target by 100 basis points.

The firm highlighted Williams Companies’ 3.5% current dividend yield, supported by a stable, fee-based business model and a backlog of accretive growth projects.

BMO Capital expects additions to Williams Companies’ 2027 and beyond project pipeline will be driven by the power sector, potentially significant in scale, which underpins the firm’s growth estimates. For deeper insights into Williams Companies’ growth prospects and 10+ additional ProTips, visit InvestingPro.

In other recent news, Williams Companies reported its second-quarter earnings for 2025, revealing a mixed performance with a slight miss on its earnings per share (EPS) forecast but surpassing revenue expectations. The company’s EPS was $0.46, slightly below the $0.48 forecast, while revenue reached $2.78 billion, exceeding the expected $2.72 billion. Additionally, the company has accelerated the startup timeline for its Southeast Supply Enhancement Project, which is now expected to be operational in the third quarter of 2027, 4-5 months earlier than initially planned.

Analyst firms have shared their perspectives on Williams Companies, with UBS maintaining a Buy rating and a $74.00 price target, and Stifel also reiterating a Buy rating with a $64.00 price target, citing the company’s growth prospects in natural gas. Wells Fargo raised its price target to $70.00 from $67.00, maintaining an Overweight rating despite the company’s underperformance following its second-quarter results. Meanwhile, Williams’ CEO has projected that liquid natural gas (LNG) will grow to represent more than 25% of the US gas market within the next decade, up from the current 15%. These developments highlight the company’s ongoing strategic initiatives and potential future growth in the natural gas sector.

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