Master limited partnerships (MLPs) can be attractive income-producing investments at any time, but with yields of 5%, 6%, 7%, or higher, yield-hungry investors with a long-term focus should be considering them seriously.
Investors tend to lump energy MLPs into a single bucket, but this isn't the case. MLPs can be broken down into several subgroups including major diversified, such Energy Transfer Partners (ETP); natural gas pipelines and storage, such as El Paso Pipeline Partners (EPB); oil pipelines and storage, such as Plains All American (PAA); gas gathering and processing companies, such as MarkWest Energy (MWE); and oil and gas production companies, such as Linn Energy (LINE), among others.
Each of the MLP subsectors has its own dynamics, with some more exposed to energy prices, spot rates, and weather than others. One of the top subsectors for investors to consider is natural gas pipeline operators, which basically act as "toll takers" that collect fees for transporting gas from where it is produced or imported to where it is stored or used, often under long-term contracts with suppliers. The companies tend not to be exposed to volatile commodity prices and their cash flows support steady distribution growth.
In a new 35-page special report entitled Searching for High Yield Winners in 2014, BullMarket.com gives its top-9 high-yield stocks for the new year. This is the 6th annual High Yield Report BullMarket.com has published. The 5-year cumulative return of the other reports are 203.8%.
Find out which MLPs made this year's report.
For access to the 35-page report, examining each pick's dividend history, business activities, strengths, weaknesses, latest earnings report, and much more, visit BullMarket.com. MLP investors would also be interested in BullMarket.com's dedicated MLP hub and earlier MLP special report.
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- Utility Industry
- Basic Materials Industry
- Energy Transfer Partners