Oil prices have been scorching hot this year. Crude prices are up more than 30%, recently topping $60 a barrel and nearing a two-year high. That's fueled big rallies in most energy stocks.

However, many energy companies still haven't fully recovered from last year's beating. As a result, some trade at dirt-cheap levels. Three that stand out as great values these days are energy midstream companies Crestwood Equity Partners (CEQP)Energy Transfer (ET -1.66%), and Williams Companies (WMB -1.35%).

A calculator and pen on top of $100 bills.

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A sky-high yield for an absurdly low value

Crestwood Equity Partners navigated last year's energy market downturn exceptionally well. The master limited partnership (MLP) generated $580.3 million of adjusted EBITDA, which was 10% above 2019's level despite all the turbulence in the oil market. It also produced $361.2 million in cash, which was enough to cover its 9.9%-yielding dividend by two times. That gave it the money to finance its expansion projects and repay debt.

The company expects to generate around the same amount of earnings and cash flow this year, with upside potential if volumes improve, which seems likely given the current oil price. Despite this overall growth, Crestwood's unit price is down almost 20% since the start of 2020. Because of that, it trades at about seven times its earnings and around five times cash flow. Those are absurdly cheap levels for a company producing significant excess cash as it's on track to cover its distribution and capital spending with room to spare in 2021.

Even cheaper following a value-enhancing deal

Energy Transfer didn't do quite as well as Crestwood last year. The MLP's earnings and cash flow declined by a mid-single-digit rate due to the impact of oil market volatility on its operations. However, it still generated a mountain of cash, which it used to pay its 7.3%-yielding distribution and cover its growth projects. 

Energy Transfer expects its earnings to bounce back in 2021, rising to about $10.8 billion in adjusted EBITDA at the midpoint. However, due to a roughly 35% decline in its unit price since the start of 2020, the MLP currently trades at less than eight times its earnings. Meanwhile, the company is even cheaper when factoring in its pending merger with fellow MLP Enable Midstream (ENBL). The two will combine in a $7.2 billion deal, valuing Enable at around seven times its expected 2021 adjusted EBITDA level of about $1 billion. Thus, Energy Transfer is even cheaper when combined with Enable, which will enhance its midstream footprint and credit profile while generating $100 million in annual cost savings.

Sunset through the twists of a pipeline system.

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Even cheaper despite its strength amid the storm

Natural gas pipeline giant Williams Companies performed pretty well in 2020 despite several headwinds, including a global pandemic, volatile energy prices, and an active hurricane season in the Gulf of Mexico. Overall, the company generated record adjusted EBITDA of $5.1 billion and distributable free cash flow of $3.4 billion, thanks to record volumes. That enabled Williams to produce enough cash to cover its 6.9%-yielding dividend and its growth capital program with more than $200 million to spare. 

The company anticipates producing even better results in 2021. It's forecasting $5.2 billion of adjusted EBITDA and $3.7 billion of available funds from operations at the midpoint of its guidance range. Despite that strength amid all those headwinds, shares of Williams Companies have flatlined over the past year. As a result, it trades at an even cheaper price based on its 2021 forecast of around 10 times earnings and eight times cash flow.

Low valuations = high dividend yields

Crestwood Equity Partners, Energy Transfer, and Williams Companies all expect to deliver improved results in 2021. Despite that, their share prices are flat to down since the start of last year even though oil prices are at their highest level in years. All three energy stocks look dirt cheap these days. Furthermore, due to their low valuations, all three offer high dividend yields. That means investors get paid well while they wait for the market to realize how cheap these stocks are right now. Combine that income with their upside, and this trio of pipeline stocks could produce high-octane total returns if the energy market continues to recover.