VettaFi Head of Energy Research Stacey Morris joined Steve Darling from Proactive to about about the resilience of the midstream energy sector in 2024, which has delivered strong results despite broader energy sector challenges.
Unlike other energy segments, midstream companies focus on transporting energy via long-term, fee-based contracts, offering more stable cash flows independent of oil price shifts. Morris noted that midstream firms have thrived on rising natural gas demand, driven by power sector needs and data center growth, with some companies experiencing 60-80% growth.
Additionally, Morris discussed VettaFi’s recent transition to a new underlying index for the Alerian Midstream Energy Dividend, enhancing the fund’s structure and targeting high-performing companies, resulting in an average dividend yield of around 5%. The sector’s growth and stability position it well for continued demand-driven returns.