Genesis Energy, L.P. (GEL): A Bull Case Theory

We came across a bullish thesis on Genesis Energy, L.P. on Valueinvestorsclub.com by Ipartners. In this article, we will summarize the bulls’ thesis on GEL. Genesis Energy, L.P.’s share was trading at $17.36 as of June 27^th. GEL’s trailing P/E was 41.53 according to Yahoo Finance.

Genesis Energy (GEL) offers a highly asymmetric investment opportunity following the March 2025 sale of its soda ash business to WE Soda Ltd. for an enterprise value of $1.425 billion—over 10x trough EBITDA. This transaction significantly improved GEL’s capital efficiency by reducing debt and eliminating ~$203 million in annual cash outflows (interest, maintenance capex, and preferred dividends), exceeding the $140 million EBITDA contribution from soda ash and thus making the deal cash-flow accretive by ~$63 million.

With growth capex largely complete, GEL’s focus has now shifted toward capital returns and deleveraging, supported by management’s commitment to a shareholder-friendly capital allocation strategy. The company anticipates generating ~$2.50/share in free cash flow by 2026, with a path to a $1.50 dividend next year and potential further hikes as preferreds are retired. Current operations are underpinned by stable cash flows from its marine, pipeline, and sulfur businesses—segments with minimal maintenance capex—and potential asset sales could accelerate deleveraging.

Furthermore, the Shenandoah and Salamanca developments, ramping up in mid-2025, are expected to deliver $110 million in contracted EBITDA at conservative production levels. Upside to guidance exists, as operators anticipate outperforming base case volumes. Longer-term, tiebacks like Monument and Shenandoah South could unlock up to 600 million barrels of P50 reserves, fully dedicated to GEL’s pipeline infrastructure, ensuring years of robust offshore cash flow.

GEL’s marine segment, already a discount to peers, could benefit from rising barge rates due to structural supply constraints. With a potential doubling of the stock price and low execution risk, GEL presents a compelling rerating story.

Previously, we covered a bullish thesis on Golar LNG (GLNG) by unPopular Investing in June 2025, which highlighted the company’s pivot to a de-risked FLNG model with long-term contracts and strong ESG positioning. The company’s stock price has depreciated by approximately 0.71% since our coverage. This is because the thesis hasn’t yet played out. Ipartners emphasizes GEL’s near-term cash flow strength and asset monetization.

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Disclosure: None. This article was originally published at Insider Monkey.