Energy Infrastructure/MLPs Weekly: KMI 2Q26 Earnings Read-Throughs; Thoughts Into Earnings Next Week; Global LNG Analyzer; Comps; News Flow; Midstream Leads Market

Research evidence excerpt

Energy Infrastructure/MLPs Weekly: KMI 2Q26 Earnings Read-Throughs; Thoughts Into Earnings Next Week; Global LNG Analyzer; Comps; News Flow; Midstream Leads Market

mand balance and JKM forecasts, expecting the premium to

narrow as Europe eventually needed to outbid Asia for marginal US spot cargoes. How

the market could rebalance. Our early framework projected market rebalancing

through higher alternative supply, demand destruction, and gas-to-coal switching. We

expected alternative supply to offset up to half of lost volumes, with the rest absorbed by

lower demand. Healthy coal inventories and more fuel-switching flexibility (vs. 2022)

meant that TTF spikes above €60–70/MWh during summer would likely be short lived.

What actually happened. June supply was particularly strong; Asian demand proved

more resilient even at $20/MMBtu spot prices, and Egypt imports reached new highs.

Our Asia Outlook webinar helped explain this. China remains price sensitive and uses

LNG as the swing molecule, while India’s rebound was driven more by availability than

price. As a result, Europe became the residual balancing market, with LNG imports

falling sharply as JKM premiums kept marginal US cargoes moving toward Asia.

• Post YTD strength, group above historical levels; structurally stronger

fundamentals underpin bullish outlook. Looking at NTM EV/ EBITDA multiple

valuation across our midstream coverage, current valuations land near 2019 levels. We

see significantly lower leverage, sustainable and growing dividends, capital discipline,

and improved cost structures all arguing for a healthy premium when comparing now

versus then. Within our coverage, large-cap MLPs currently trade at a ~2x EV/EBITDA

discount versus US C-corps and 3x EV/EBITDA discount versus Canadian C-corps.