If you are an income investor, then Energy Transfer Equity LP (NYSE:ETE) should be on your radar. Energy Transfer Equity, L.P. provides diversified energy-related services in the United States. Over the past 10 years, the US$18.53b market cap company has been growing its dividend payments, from $0.44 to $1.22. Currently yielding 7.12%, let’s take a closer look at Energy Transfer Equity’s dividend profile. See our latest analysis for Energy Transfer Equity
What Is A Dividend Rock Star?
It is a stock that pays a consistent, reliable and competitive dividend over a long period of time, and is expected to continue to pay in the same manner many years to come. More specifically:
- It is paying an annual yield above 75% of dividend payers
- It has paid dividend every year without dramatically reducing payout in the past
- Its dividend per share amount has increased over the past
- It is able to pay the current rate of dividends from its earnings
- It is able to continue to payout at the current rate in the future
High Yield And Dependable
Energy Transfer Equity currently yields 7.12%, which is high for Oil and Gas stocks. But the real reason Energy Transfer Equity stands out is because it has a proven track record of continuously paying out this level of dividends, from earnings, to shareholders and can be expected to continue paying in the future. This is a highly desirable trait for a stock holding if you’re investor who wants a robust cash inflow from your portfolio over a long period of time.
If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. In the case of ETE it has increased its DPS from $0.44 to $1.22 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. These are all positive signs of a great, reliable dividend stock.
Energy Transfer Equity has a trailing twelve-month payout ratio of 89.81%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 73.86%, leading to a dividend yield of around 8.09%. However, EPS should increase to $1.77, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
Energy Transfer Equity’s strong dividend attributes make it, without a doubt, a stock dividend investors should be considering for their portfolios. However, given this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Below, I’ve compiled three relevant factors you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for ETE’s future growth? Take a look at our free research report of analyst consensus for ETE’s outlook.
- Valuation: What is ETE worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether ETE is currently mispriced by the market.
- Other Dividend Rockstars: Are there strong dividend payers with better fundamentals out there? Check out our free list of these great stocks here.