ETRN - Equitrans Midstream: Despite The MVP Setback Dividends Remains Safe For Now

• Equitrans Midstream recently saw the permits for their MVP project vacated following a court ruling, thereby casting doubts over its completion.
• Whilst this hurt their share price, at least their cash flow performance was solid during 2021 with very strong dividend coverage.
• Management has not issued any earnings guidance for 2022 but given their broadly flat year-on-year capital expenditure guidance, their free cash flow should be similar to 2021.
• Whilst management continues to support their dividends, thereby making them safe for now, this may change once 2022 ends with their credit facility covenant leverage ratio limit decreasing significantly.
• Despite not being ideal, their high 7%+ dividend yield helps compensate and thus I believe that maintaining my buy rating is appropriate.

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