Black Stone Minerals
Houston-based Black Stone Minerals L.P. (NYSE: BSM) owns and manages royalty interests in oil and natural gas production across 41 states. As is the case with other companies that rely on royalty payments for revenue, when the price goes up so do distributions to limited partners.
Black Stone’s market cap is $3.1 billion, and just six brokerages cover the stock. Half have a Buy rating on the common units and the other half have Hold ratings. Based on a median price target of $18.00, the upside potential is around 21.5%.
The company raised its distribution for the first quarter to $0.40 per common unit, a jump of 48% from the prior quarter. Black Stone’s forward yield is 11.95%, and the payout ratio is 137.35%. The 52-week trading range is $9.47 to $16.35, and the total one-year shareholder return is 63.23%. Blackstone’s share price gain for the past 12 months was 63.8%.
Denver-based Antero Midstream Corp. (NYSE: AM) owns and operates a natural gas network that collects and processes gas from wells in the Marcellus and Utica shale plays located in Ohio and West Virginia that are operated by Antero Resources. In a joint venture with MPLX, the two firms have a 40,000-barrel per day natural gas liquids (NGL) fractionation capacity with a daily processing capacity of 1.6 billion cubic feet per day.
Antero Midstream has a market cap of $4.82 billion and, unlike the other companies on this list, is organized as a C-corporation. Only nine brokerages cover the company, and four of those have Hold ratings, while just one rates the stock at Buy. This is the weakest rating among the five stocks on our list, likely because its upside potential is just 5%, based on its median price target of $10.50.
The company pays an annual dividend of $0.90, for a yield of 8.96%, and its payout ratio is a lusty 131.8%. The stock’s 52-week range is $8.42 to $11.71. The total one-year shareholder return is 9.63%.
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