Energy Business

Energy Stocks Are on Fire and These 5 Pay Lavish and Reliable Dividends

Enterprise Products Partners

This is the largest publicly traded energy partnership and a leading North American provider of midstream energy services to producers and consumers. Enterprise Products Partners L.P. (NYSE: EPD) provides a wide variety of midstream energy services, including gathering, processing, transportation and storage of natural gas, natural gas liquids fractionation, import and export terminaling, and offshore production platform services.

One reason many analysts may have a liking for the stock might be its distribution coverage ratio. This ratio is well above 1 times, making it relatively less risky among the MLPs.

The company’s distributions have grown consistently over the years, and last year it announced that the board of directors of its general partner declared an increase in the quarterly cash distribution paid to partners to $0.45 per common unit, or $1.80 per unit on an annualized basis.

Enterprise Products Partners stock investors receive a 7.48% distribution. The analysts at Wells Fargo have an Overweight rating and recently raised the price target to $28. The consensus price target is right in line at $28.04. Shares closed Tuesday trading at $24.07 apiece.


This is the top holding for the Alerian MLP energy exchange-traded fund. MPLX L.P. (NYSE: MPLX) is primarily engaged in crude oil and refined products transportation and terminaling in the U.S. Midwest and Gulf Coast regions, as well as natural gas gathering and processing in the northeast from its prior acquisition of MarkWest Energy in 2015. MPLX was formed by independent U.S. refiner Marathon Petroleum.

The company reported solid first-quarter financial results, with $739 million in net income while adjusted EBITDA was $1.4 billion. The company generated $1.1 billion in net cash from operating activities. Its chief executive officer said at the time that the company is eyeing share buybacks, but those will depend on market conditions.

Investors receive an outstanding 9.46% distribution. Barclays has an Overweight rating on MPLX stock and recently raised the price target to $32 from $29. That compares with the lower $31.07 consensus target and Tuesday’s closing print of $29.04 a share.

Two integrated supermajors and three top MLPs are all solid ideas for investors looking to have a position in the energy sector while generating consistent quarterly dividends. It is important to remember that MLP distributions could contain return of principal and that investors need to file a K-1 with their tax return.

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