ET - This 7.9%-Yielding Dividend Stock Continues to Pump More Income Into its Investors' Pockets
2024-04-28 06:47:00 ET
Energy Transfer (NYSE: ET) has become a premium passive income producer in recent years . The master limited partnership (MLP) pays a significantly above-average cash distribution that currently yields 7.9%, compared with the 1.4% dividend yield of the S&P 500 . Meanwhile, it has been steadily pushing that payout higher each quarter.
The MLP recently declared its latest distribution increase, pushing its payout 3.3% above the year-ago level. It should have plenty of fuel to continue growing its big-time payout in the future. That makes it an excellent option for those seeking a steadily rising passive income stream and who understand the potential tax implications of investing in an MLP.
Energy Transfer hasn't always been the most reliable income stock. The MLP cut its distribution payment in half during the pandemic to retain additional cash to fund expansion projects and debt reduction. That strategy has paid off. It was able to steadily chip away at its leverage ratio , driving it down to its 4.0 to 4.5 target range within the last year. That allowed the company to steadily bring its distribution back up to its pre-pandemic level, which it achieved early last year.
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This 7.9%-Yielding Dividend Stock Continues to Pump More Income Into its Investors' Pockets