Episode 1421: Unapologetic Energy Bull: Meet Me in the Middle

Today's Post - https://bahnsen.co/4rwGwnT

David Bahnsen hosts the Friday Dividend Cafe and explains he chose to focus on an energy investment theme rather than the week’s surge in bond yields. He argues investors and media overemphasize headlines about the Strait of Hormuz, Iran, and WTI prices, while the energy sector remains largely ignored due to its small S&P 500 weight (about 3.5% versus Apple at 7.4%, and midstream at 0.5%). He notes oil supply disruptions have been buffered by large inventory drawdowns, and that energy equities appear disconnected from oil’s move, with valuations running about 70% of their historical relationship to the broader market. He makes a bullish, longer-term case tied to AI-driven power needs and highlights midstream “2.0” fundamentals: rising domestic and global natural gas demand, expanding LNG export capacity, hard-to-permit pipelines with inflation-protected contracts, better governance, lower leverage, and strong distribution growth potential.

00:00 Welcome And Setup

01:07 Why Energy Is Ignored

05:03 Index Weighting Reality

08:49 Hormuz Supply Shock

11:55 Oil Versus Stocks Gap

14:08 AI Needs More Power

15:16 Valuation Case For Energy

17:14 Midstream Opportunity

18:24 Midstream PTSD And Comeback

19:51 Midstream 2.0 Tailwinds

22:20 Pipelines And Capital Discipline

25:15 Wrap Up And Takeaway

Links mentioned in this episode: DividendCafe.com

TheBahnsenGroup.com