Latest news with #EnterpriseProductsPartners
Yahoo
3 days ago
- Business
- Yahoo
Should You Buy Enterprise Products Partners While It's Below $33?
Enterprise Products Partners is a large North American midstream operator. The master limited partnership's unit price has been on the rise for several years. Enterprise's distribution has been heading steadily higher for decades. 10 stocks we like better than Enterprise Products Partners › Enterprise Products Partners (NYSE: EPD) is offering investors an attractive 6.7% distribution yield. That compares to the tiny 1.2% yield for the S&P 500 (SNPINDEX: ^GSPC) and a 3.5% or so average yield in the broader energy sector. The big draw here is, obviously, the yield. But is that enough to make Enterprise a buy while it's trading below $33 a unit? Here's what you need to know. Enterprise Products Partners is a fairly boring business, which is a bit unusual in the energy sector. Upstream companies, which produce oil and natural gas, have volatile earnings because oil and natural gas prices dictate their top- and bottom-line results. Downstream companies, which make chemicals and refined products like gasoline, have volatile earnings because volatile oil and natural gas are key inputs, and the products they make are often volatile commodities, too. But midstream businesses like Enterprise are just toll takers. Midstream operators own energy infrastructure like pipelines, storage, processing, and transportation assets. They charge upstream and downstream companies fees for the use of these assets. Demand for energy is far more important to the top and bottom lines of a midstream business like Enterprise than the price of the commodities being moved. Energy is so vital to the global economy that demand tends to remain robust throughout the energy cycle. And, thus, Enterprise's cash flows are fairly consistent over time. That is how it supports such a large distribution payment, and how Enterprise has managed to increase that distribution every single year for 26 consecutive years. If you are looking for an ultra-high yield that is actually sustainable, Enterprise Products Partners should be on your short list. Enterprise has been far more attractive in the past, noting that its yield was over 10% during the early days of the coronavirus pandemic and associated bear market. That said, the master limited partnership's (MLP's) units have rallied strongly since that point. With the yield at around 6.7%, however, it is still an attractive yield option. The key is the regular distribution increases. The last time Enterprise's unit price was in the $33 range, the yield was closer to 4%. Price alone isn't the key determinant here -- it is the combination of price and yield. And now that the distribution has had some time to grow, the price looks more attractive. But there's more to this story than just price and yield. Enterprise has an investment-grade-rated balance sheet, so it is on a sound financial footing. In 2024, the distribution was covered 1.7x by the MLP's distributable cash flow. It is also one of the largest players in the North American midstream sector. Put all of that together, and Enterprise is a very reliable income investment. The future is likely to look a lot like the past for Enterprise Products Partners. That basically means slow and steady growth of the business and the distribution. Right now, it has around $7.6 billion worth of capital investment projects in the works. That, plus regular price increases and the occasional acquisition, should keep the distribution growing for years to come. And that, in turn, should support further unit price gains. All in, Enterprise is still a solid income option at $33 and, perhaps, even a little higher. Before you buy stock in Enterprise Products Partners, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Enterprise Products Partners wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $653,702!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $870,207!* Now, it's worth noting Stock Advisor's total average return is 988% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy. Should You Buy Enterprise Products Partners While It's Below $33? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
4 days ago
- Business
- Yahoo
5 Safe Dividend Stocks Yielding Over 5% You Can Buy Without Hesitation Right Now for Passive Income
These companies generate very stable cash flows to support their high-yielding dividends. They also have rock-solid balance sheets. Their strong financial profiles enable them to grow their businesses and increase their dividends. 10 stocks we like better than Enterprise Products Partners › Higher-yielding dividend stocks can produce a lot of passive income. However, one drawback is that a higher dividend yield can be a warning sign that the payout is at risk of a reduction. That's not always the case. Here are five low-risk dividend stocks with yields above 5%, which is more than triple the S&P 500's sub-1.5% dividend yield. Because of their lower risk profiles, you can confidently buy these higher-yielding dividend stocks for passive income right now. Enterprise Products Partners (NYSE: EPD) currently yields 6.7%. The master limited partnership (MLP), which sends investors a Schedule K-1 Federal Tax Form each year, backs that payout with a very stable cash flow profile and strong balance sheet. The midstream energy company's integrated network of pipelines, processing plants, storage terminals, and export facilities generates predictable cash flow backed primarily by long-term, fixed-rate contracts and government-regulated rate structures. The company produced enough distributable cash flow to cover its high-yielding payout by a comfy 1.7 times in the first quarter. Enterprise also has the strongest balance sheet in the energy midstream sector. The MLP has proved the durability of its high-yielding distribution over the decades by increasing it for 26 straight years. That streak seems likely to continue. Enterprise currently has $7.6 billion of major capital projects on track to enter commercial service through the end of next year. The incremental free cash flow from those projects will give the company even more fuel to continue increasing its high-yielding payout. Enbridge (NYSE: ENB) currently yields 5.8%. The Canadian pipeline and utility company produces stable cash flow to backstop that payout. Predictable cost-of-service agreements and long-term, fixed-fee contracts lock in 98% of its annual earnings. Its earnings are so predictable that Enbridge has achieved its annual financial guidance for 19 years in a row. Enbridge pays out 60% to 70% of its stable cash flow in dividends, retaining the rest to help fund expansion projects. Enbridge also has a strong investment-grade balance sheet with a leverage ratio trending toward the lower end of its target range. That gives it the flexibility to invest billions of dollars every year into expanding its oil pipelines, natural gas pipelines, natural gas utilities, and renewable power businesses. This growth gives it the fuel to increase its dividend, which Enbridge has done for 30 straight years. NNN REIT (NYSE: NNN) has a 5.5% dividend yield. The REIT focuses on investing in single-tenant retail properties secured by long-term, triple-net (NNN) leases. Those leases provide it with stable cash flow to pay dividends because tenants cover all property operating expenses, including routine maintenance, real estate taxes, and building insurance. The REIT has a conservative dividend payout ratio and balance sheet. It expects to produce $200 million in post-dividend free cash flow this year and has a sector-leading 11.6-year weighted average debt maturity. Those features give it lots of capacity to invest in new income-generating retail properties. It primarily buys properties through sale-leaseback transactions with its existing tenants. This strategy has steadily grown its income, enabling NNN REIT to raise its dividend payment for 35 straight years. Only two other REITs and fewer than 80 publicly traded companies have reached that milestone. Verizon (NYSE: VZ) has a 6.3% dividend yield. The mobile and broadband giant produces lots of recurring cash flow as customers pay their bills. Last year, Verizon generated $36.9 billion in cash flow from operations. That was enough money to cover its capital expenditures to maintain and expand its fiber and 5G networks, which accounted for $17.1 billion, and its dividend payment, accounting for $11.2 billion, leaving $8.6 billion in excess free cash flow to spare. That surplus enabled Verizon to strengthen its already rock-solid balance sheet. Verizon is also buying Frontier Communications in a $20 billion deal to bolster its fiber network, and its overall growth investments in 5G and fiber should support growing cash flows in the future. That should enable the company to continue increasing its high-yielding dividend. Last year, Verizon raised its payout for the 18th year in a row, the longest current streak in the U.S. telecom sector. Vici Properties (NYSE: VICI) has a 5.4% dividend yield. The REIT backs its payout with a high-quality real estate portfolio. Vici Properties invests in market-leading gaming, hospitality, wellness, entertainment, and leisure destinations. It leases these properties back to operating tenants under very long-term NNN leases, with a 40.4-year weighted average lease term remaining. The REIT pays out 75% of its stable income in dividends. It also has a rock-solid investment-grade balance sheet. These features give it the financial flexibility to invest in additional income-generating experiential real estate. Vici's growing portfolio has enabled it to steadily increase its dividend. It has raised its dividend in all seven years since its formation, growing its payout at a 7.4% compound annual rate, which leads its NNN lease peers. Enterprise Products Partners, Enbridge, NNN REIT, Verizon, and Vici Properties generate stable cash flow, which helps support their more than 5%-yielding payouts. These companies also have strong financial profiles, which allows them to invest in growing their businesses. That growth has supported steady dividend increases, which seems likely to continue. This combination of yield, financial strength, and growth is why you can buy any one of these high-yielding dividend stocks for passive income without hesitation right now. Before you buy stock in Enterprise Products Partners, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Enterprise Products Partners wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $653,702!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $870,207!* Now, it's worth noting Stock Advisor's total average return is 988% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Matt DiLallo has positions in Enbridge, Enterprise Products Partners, Verizon Communications, and Vici Properties. The Motley Fool has positions in and recommends Enbridge. The Motley Fool recommends Enterprise Products Partners, Verizon Communications, and Vici Properties. The Motley Fool has a disclosure policy. 5 Safe Dividend Stocks Yielding Over 5% You Can Buy Without Hesitation Right Now for Passive Income was originally published by The Motley Fool
Globe and Mail
5 days ago
- Business
- Globe and Mail
This 6.7% Dividend Stock Looks Absurdly Good Today
I first initiated a position in Enterprise Products Partners (NYSE: EPD) more than two years ago. How has that investment fared so far? Not bad. The midstream energy company has generated a total return of roughly 45%. Granted, that performance lags behind the S&P 500 's total return of 56% during the same period. However, one thing I could count on, rain or shine, with Enterprise Products Partners was (and is) its juicy distribution. How does the stock look today? Absurdly good, in my opinion. An income investor's dream stock First of all, Enterprise Products Partners is an income investor's dream stock. It currently offers a forward distribution yield of 6.7%. The master limited partnership (MLP) doesn't have to produce much in the way of unit price appreciation to deliver a solid total return. What's more, Enterprise boasts an outstanding track record of distribution hikes. The company has increased its distribution for 26 consecutive years. It has also paid $1.2 billion in "invisible" distributions since its initial public offering in 1998 via unit buybacks. Building this impressive record wasn't easy. Enterprise Products Partners faced multiple big challenges through the years, including the financial crisis of 2007 through 2009, the oil price collapse of 2015 through 2017, and the COVID-19 pandemic of 2020 through 2022. However, it was able to generate strong cash flow per unit to fund its distributions during every crisis. Some rivals were forced to resort to selling assets to cover their distributions during tough periods. Not Enterprise Products Partners. It's the only midstream energy company that has been able to grow its adjusted cash flow from operations (CFFO) per unit and reduce unit count without any material asset sales. Today, Enterprise Products Partners operates more than 50,000 miles of pipeline. It owns 43 natural gas processing trains and 26 fractionators, which separate the components of hydrocarbons. In addition, the MLP can store over 300 million barrels of liquids and has 20 deepwater docks. More to the story I mentioned earlier that Enterprise Products Partners' total return hasn't been as high as the S&P 500's since I bought it. If we looked back over the last five years, though, it would be a different story. Enterprise has also narrowly outperformed the S&P 500 in total return so far in 2025. The MLP's distribution isn't the only reason behind its market-beating total returns. The rising demand for U.S. hydrocarbons, especially natural gas liquids (NGLs), has played a key role as well. I think these demand trends will extend well into the future. Production of oil, NGLs, and natural gas is projected to increase steadily through the end of this decade. Artificial intelligence (AI) is an important driver behind the higher demand for natural gas. The data centers that host AI models require massive amounts of electricity, and natural gas is a good option to fuel the power plants that serve these data centers. In addition, LNG demand in Asia and Europe is expected to rise by roughly 30% by 2030. Enterprise is well positioned to capitalize on the demand growth. The MLP has $7.6 billion in major capital projects underway, with $6 billion of these projects projected to come online this year. It is also hitting the ground to create more opportunities: Enterprise's staff have visited over 20 international cities to boost export growth. An attractive valuation, too What more could investors want than an ultra-high-yield distribution and solid growth prospects? An attractive valuation. Enterprise Products Partners has that, too. The MLP's units trade at 11.2 times forward earnings. That's the lowest forward earnings multiple in its peer group. It's also well below the S&P 500 energy sector's forward price-to-earnings ratio of 15.9. I think Enterprise Products Partners easily qualifies as an absurdly good stock to buy right now. Should you invest $1,000 in Enterprise Products Partners right now? Before you buy stock in Enterprise Products Partners, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Enterprise Products Partners wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $653,702!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $870,207!* Now, it's worth noting Stock Advisor 's total average return is988% — a market-crushing outperformance compared to172%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 9, 2025
Yahoo
7 days ago
- Business
- Yahoo
Top Oil Stocks With Great Dividends: What Should I Invest In Right Now?
Key Points Enterprise Products Partners pays an attractive distribution and has a highly resilient business. Energy Transfer offers an especially juicy yield and has AI-related growth opportunities. Enbridge is a diversified energy company that has increased its dividend for 30 consecutive years. 10 stocks we like better than Enbridge › As always, The Motley Fool cannot and does not provide personalized investing or financial advice. This information is for informational and educational purposes only and is not a substitute for professional financial advice. Always seek the guidance of a qualified financial advisor for any questions regarding your personal financial situation. If you'd like to submit your question for feedback, you can do so here. Oil stocks have been longtime favorites for investors seeking income. With lower oil prices causing many oil stocks to decline in recent months, their dividend yields have risen. A user on Reddit recently asked which oil stocks with attractive dividends are the best picks right now. There are plenty of good answers to that question, but I think three oil stocks especially stand out. 1. Enterprise Products Partners I think the best oil stocks for income investors right now can be found in the midstream industry. And my favorite midstream stock is Enterprise Products Partners (NYSE: EPD). The limited partnership (LP) operates more than 50,000 miles of pipeline that transports crude oil, natural gas, natural gas liquids (NGLs), petrochemicals, and other refined products. Enterprise Products Partners' forward distribution yield is 6.67%. A high yield can sometimes be a warning sign about underlying business problems. However, that's not the case with this stock. Enterprise has increased its distribution for 26 consecutive years and should be in a great position to keep that streak going. Lower oil prices can cause lower revenue and profits for major oil producers such as Chevron and ExxonMobil. However, midstream leaders such as Enterprise Products Partners charge the same amount to transport liquids through their pipelines no matter what commodity costs are. Enterprise stands above the pack in its industry, in my view, because of its remarkable resilience. The LP has delivered double-digit percentage returns on invested capital (ROIC) and steady cash flow per unit during some of the most difficult periods for the oil and gas industry without missing a beat. 2. Energy Transfer Energy Transfer (NYSE: ET) is another midstream stock that I really like. Like Enterprise Products Partners, Energy Transfer is an LP. It operates an even more extensive network of pipelines spanning over 130,000 miles.
Yahoo
10-06-2025
- Business
- Yahoo
2 Brilliant High-Yield Energy Stocks to Buy Now and Hold for the Long Term
The energy sector is known for being volatile, though there's one industry segment that bucks the trend. Enterprise Products Partners has a lofty 6.8% yield and decades of annual distribution increases behind it. Enbridge has a 5.9% yield and decades of annual dividend increases behind it. 10 stocks we like better than Enterprise Products Partners › There is one key feature that all investors need to know about the energy sector: The commodity-driven sector can be very volatile. Or, at least, most of it can. There's one niche that actually has a pretty consistent history of reliability, particularly with regard to dividend stocks. This is why even conservative dividend investors will likely find Enterprise Products Partners (NYSE: EPD) and Enbridge (NYSE: ENB) attractive high-yield energy stocks to buy. Here's what you need to know. The energy sector is usually broken down into three subsegments. There is the upstream, which produces oil and natural gas. There is the midstream, which transports oil, natural gas, and the products into which they get turned. And there is the downstream, which processes oil and natural gas into other products, like chemicals and gasoline. The revenues in the upstream are entirely dependent on volatile oil and natural gas commodity prices. There's a similar dynamic in the downstream, since many of the products produced are commodities. However, there's another level of complexity here on the cost side, since oil and natural gas are key inputs. The sole oddity is the midstream, which normally just charges fees for moving commodities from one place to another. The up-front costs to build midstream assets, like pipelines, is fairly large. But once built, the toll-taker model employed generally produces reliable cash flows. Demand for oil and natural gas is more important than the price of oil and natural gas. And since energy is so vital to modern society, demand tends to remain robust even when oil prices are low. Enterprise and Enbridge are both midstream businesses. Just how reliable are Enterprise and Enbridge as dividend stocks? Enterprise, which is a master limited partnership (MLP), has increased its distribution for 26 consecutive years. Enbridge, a Canadian company, has increased its dividend annually for three decades. These are market-proven histories, noting that the energy sector has gone through multiple downturns over the past quarter-century. Right now, Enterprise is offering a distribution yield of 6.8%, while Enbridge has a dividend yield of around 5.9%. Both are well above the market and the broader energy industry. However, those lofty yields will likely make up the lion's share of return here. Slow and steady growth is the norm, but dividend investors probably won't find that trade-off too upsetting. While similar, Enterprise and Enbridge are not perfectly interchangeable. As noted, Enterprise is an MLP, a type of corporate structure that comes with some tax complications (notably having to deal with a K-1 statement on April 15). Enbridge, meanwhile, is Canadian, so its dividend is paid in Canadian dollars (what U.S. investors collect will change with exchange rates), and investors will have to pay Canadian taxes on the dividend (a portion of that can be claimed back come April 15). That said, Enterprise is also more focused on oil and natural gas assets than Enbridge. In fact, Enbridge's specific goal is to adjust its business along with the world's energy needs. So it has been increasingly shifting toward natural gas, including buying natural gas utilities, and it has a small, but growing, clean energy business. Enbridge is probably the more conservative of these two midstream choices. The big theme here, however, is that Enterprise and Enbridge are high-yield investments with reliable businesses that can pay you for years into the future. They aren't the kind of stocks you buy and sell frequently; they are the kind you buy and hold for the long term. That way, you benefit from the slow and steady growth of the dividend, as these reliable income investments keep pumping out cash from what is otherwise a highly volatile industry. If you are looking to boost your investment income in June, Enterprise and Enbridge should be on your list of options. Before you buy stock in Enterprise Products Partners, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Enterprise Products Partners wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $868,615!* Now, it's worth noting Stock Advisor's total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Reuben Gregg Brewer has positions in Enbridge. The Motley Fool has positions in and recommends Enbridge. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy. 2 Brilliant High-Yield Energy Stocks to Buy Now and Hold for the Long Term was originally published by The Motley Fool
