EPD - Enterprise Products Partners: Fueling Dividends Through Increased Natural Gas Demand

2024-07-15 03:59:55 ET

Summary

• Enterprise Products Partners is my top choice for exposure to MLPs due to its consistent performance history and strong distribution coverage.
• The dividend yield sits at 7.1% and is well-supported by distributable cash flows, with a coverage ratio of 1.7x.
• Despite an already high yield, the dividend has increased at a CAGR of 3.8% over the last decade. This makes EPD a great pick for compounding income.
• Natural gas demand is estimated to continually increase through 2030. EPD plans to spend $3.25B throughout 2024 to ensure they can capitalize on growing demand.

Overview

I consider myself a bit of a hybrid dividend investor because I've found success in the mixing of traditional dividend growth stocks accompanied by higher yielding asset classes. This includes different asset classes such as REITs, Business Development Companies, Closed End Funds, and Master Limited Partnerships. I really value the sense of security that an additional stream of income provides me in life, and I gave committed to growing this stream of income year after year....

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