Given the energy industry’s dependence on commodity prices, the sector tends to be cyclical and profitability can be highly variable. However, as oil prices recover from lows in 2014, energy stocks have benefited through increased profitability and cash flows. Consequently, dividend payment expectations have risen along with these companies’ profitability. Below is my list of huge dividend-paying stocks in the energy industry that continues to add value to my portfolio holdings.
CVR Energy, Inc. (NYSE:CVI)
CVI has a sumptuous dividend yield of 5.59% and has a payout ratio of 74.06% . With a yield above the savings rate, bank account beating investors will be happy, but perhaps even happier knowing that CVI is in the top quartile of market payers. The company outperformed the us oil and gas industry’s earnings growth of 24.90%, reporting an EPS growth of 848.99% over the past 12 months. More on CVR Energy here.
Holly Energy Partners, L.P. (NYSE:HEP)
HEP has an alluring dividend yield of 8.68% and their current payout ratio is 111.92% . Over the past 10 years, HEP has increased its dividends from US$1.47 to US$2.62. During this period, they haven’t missed a payment, as one would expect from a company increasing their dividend. Holly Energy Partners’s performance over the last 12 months beat the us oil and gas industry, with the company reporting 58.38% EPS growth compared to its industry’s figure of 24.90%. Interested in Holly Energy Partners? Find out more here.
DCP Midstream, LP (NYSE:DCP)
DCP has a great dividend yield of 8.64% with a generous payout ratio . DCP has increased its dividend from US$2.36 to US$3.12 over the past 10 years. They have been consistent too, not missing a payment during this 10 year period. Analysts are expecting an impressive triple digit earnings growth over the next three years. Dig deeper into DCP Midstream here.
For more solid dividend paying companies to add to your portfolio, explore this interactive list of top dividend payers.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.