Many MLPs currently offer remarkably high distribution yields. Some of these yields are traps, as they are not supported by the business performance of the MLPs. However, it is a shame to dismiss all the MLPs and thus forgo the generous yields of some MLPs, which have strong fundamentals. In this article, I will analyze how safe the 9.0% distribution yield of Holly Energy Partners (HEP) is.
Business overview
Holly Energy Partners owns and operates a network of pipelines of crude oil and refined products, storage tanks, distribution terminals, loading racks and processing