Is Energy Transfer LP overvalued or undervalued?

As of 6 May 2021, the valuation grade for Energy Transfer LP moved from risky to very attractive, indicating a significant improvement in its investment appeal. The company appears undervalued based on its current metrics, including a P/E ratio of 10, an EV/EBITDA ratio of 8.50, and a Price to Book Value of 1.74. In comparison to peers, Energy Transfer LP's P/E ratio is notably lower than that of The Williams Cos., Inc., which stands at 26.53, and Kinder Morgan, Inc., at 20.69, suggesting it is more attractively priced relative to its earnings potential.
Despite a recent underperformance with a year-to-date return of -10.97% compared to the S&P 500's 12.22%, Energy Transfer LP has shown strong long-term performance, with a 5-year return of 190.67% versus the S&P's 96.61%. This long-term outperformance, coupled with its attractive valuation ratios, reinforces the view that Energy Transfer LP is currently undervalued.