SUN - 2 Bargain Stocks You Can Buy Today
The big transition taking shape in the energy space is the shift from carbon fuels, like oil, to cleaner alternatives, like electricity. But this switch is likely to be a multidecade affair, leaving plenty of time for investors to collect distributions from well-positioned industry players like Magellan Midstream Partners (NYSE: MMP) and Sunoco LP (NYSE: SUN) . Here's what you need to know.
Magellan's master limited partnership (MLP) units are up 40% since their mid-March 2020 lows. Sunoco's units have advanced an even more impressive 129% over that same span. And yet both are still around 40% below their high water marks in 2015 or so. In other words, they still have not fully recovered.
That's highlighted by their distribution yields. Magellan's yield is 8.7% while Sunoco's is an even larger 9.2%. Both are high on an absolute basis, noting that the S&P 500 , despite the current bear market, yields a tiny 1.4%. And while Sunoco's distribution hasn't been increased since 2016, neither has it been cut. Magellan, meanwhile, has increased its distribution every year since its initial public offering in 2001. So the high yields here also likely indicate a relatively attractive entry point.
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2 Bargain Stocks You Can Buy Today