LINE has 7% vs. 4.7% distribution plus is cheaper $41.5 vs. $54.10. Seems like a good time to switch since projected growth next year is much greater. Please advise. I am retired and looking for greatest income plus security. I could sell 1000 EPD and have 1300 LINE at a higher % distribution plus they have always grown dist. like EPD. Please tear this apart for me. Afraid of huge inflation coming.
How "cheap" a security is cannot be defined by pure price? I suspect LINE is trading at a premium due to a higher yield. If you just want income, look at PHK, 10% a year, paid monthly. Now like LINE, I don't see a lot of capital appreciation but it should be okay for another year or two.
"How "cheap" a security is cannot be defined by pure price?"
That's true. Ridiculous to say one is "cheaper" because the price is lower.
"I suspect LINE is trading at a premium due to a higher yield."
But this is just as silly as the earlier statement. Yield is a function of price (ie. payout divided by price) so to say that price is high due to the yield is nonsense.
Line has a higher yield, but that is because it is an E&P which have higher risk than midstreams. Which is not to say that EPD has no commodity price risk, they do.
if you buy LINE, be patient and wait for a pullback. it's currently trading at an all-time high. we saw the MLPs drop $5 in May. it can happen again.
MWE is also an good option with a 5.77% yield. they've had frequent SPOs... i'd buy it then.
if price targets mean anything to you.......
LINE is currently trading at $1.80 below its ave 12 month price target
EPD is currently trading at $3.33 below its ave 12 month price target.
MWE is currently trading at $4.06 below it's ave 12 month price target.