Why Williams Is Ready to Outperform

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, energy infrastructure company Williams Companies (NYSE: WMB  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Williams and see what CAPS investors are saying about the stock right now.

Williams facts

 

 

Headquarters (founded)

Tulsa, Okla. (1908)

Market Cap

$20.9 billion

Industry

Oil and gas storage and transportation

Trailing-12-Month Revenue

$7.7 billion

Management

CEO Alan Armstrong (since 2011)
CFO Donald Chappel (since 2005)

Return on Equity (average,
past 3 years)

9.2%

Cash/Debt

$431.0 million / $9.5 billion

Dividend Yield

3.9%

Competitors

Dynegy (NYSE: DYN  )

El Paso

ExxonMobil (NYSE: XOM  )

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 96% of the 542 members who have rated Williams believe the stock will outperform the S&P 500 going forward.

A few months ago, one of those bulls, djohn1969, succinctly summed up the Williams bull case for our community:

Williams Companies is one of the best-run oil & gas infrastructure companies out there and is very shareholder friendly. For example, [Williams] currently pays a healthy 3.6% yield.

In addition to the value of the strong dividends ... Williams has eliminated a lot of risk by spinning off its exploration business. 

It's also important to note that [Williams] also owns 75% of its [Williams Partners (NYSE: WPZ  ) ] master limited partnership (including the general partner interest). So, owning the [Williams] parent company gives investors significant exposure to the value of [Williams Partners], but without the tax headaches of an MLP. And, considering [Williams'] stated dividend policy, I wouldn't be surprised to see it yielding in the 5-7% range like an MLP within the next few years too.

If you want market-thumping returns, you need to put together the best portfolio you can. Of course, despite a strong four-star rating, Williams may not be your top choice.

We've found another stock we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2013." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

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