Here’s why the APA share price is in the green today

Is the energy infrastructure company on the prowl for an acquisition?

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Key points

  • APA Group shares are swapping hands for $11.475 apiece, up 0.92%
  • Rumours are circulating that the energy giant is considering an acquisition in the United States
  • APA mentioned its interest in the US market during today's presentation at the Macquarie conference

Investors are bidding up the APA Group (ASX: APA) share price on Thursday as speculation of an entrance into the United States circulates.

This afternoon, the colossal energy infrastructure company is currently 0.92% higher at $11.475 per share. For comparison, the S&P/ASX 200 Index (ASX: XJO) is 0.6% in the green.

Although, many onlookers might still be wondering what is going on with APA today.

Eyeing off the energy transition opportunity

Two weeks after cementing a new 52-week high, the APA Group share price is back in the frame today. By the looks of it, the company’s presentation at the Macquarie Australia Conference has been the catalyst for heightened intrigue.

Looking at the slide deck shared with investors, it is clear the Aussie energy giant is honing in on the energy transition narrative. For instance, APA points out that it is positioning for a tighter energy market by mapping out $1.04 billion worth of capital investment. This sizeable investment will be spread across several projects including:

  • South West Pipeline Expansion – $60 million
  • East Coast Grid Expansion – $270 million
  • Kurri Kurri Lateral Pipeline – $250 million
  • Northern Goldfields Interconnect – $460 million

Furthermore, APA chief executive Rob Wheals reportedly described the United States as an attractive market during the presentation.

The United States is going through the same energy transition that Australia is going through on a bigger scale. The US market is a big market and an attractive market.

The comments are pertinent as rumours hang in the air over APA Group deliberating on a potential $4 billion acquisition in the US. According to reports, the Aussie giant might be measuring up a deal with a US electricity transmission company.

How has the APA Group share price performed?

The APA share price has been a solid investment for shareholders over the past 12 months. In fact, an investment in the company a year ago delivered an 11% outperformance of the benchmark index.

However, compared to other utility companies on the ASX, APA Group has been outdone. The pick of the bunch has been Origin Energy Ltd (ASX: ORG) with a return of 70% over the past year.

Motley Fool contributor Mitchell Lawler has positions in Macquarie Group Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended APA Group. The Motley Fool Australia has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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