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Top Midstream Stocks Offer Yields above 7%


Nov. 20 2020, Updated 4:50 p.m. ET

Stocks with high yields

Let’s take a look at midstream stocks trading at attractive yields. The stocks have a market capitalization of over $5 billion and yields over 7.0%. The biggest stock is Energy Transfer (ET). The stock is trading at a yield close to 7.9%. Energy Transfer’s relatively high leverage, complex history, and track record of stealth distribution cuts by its predecessors are some of the reasons for its higher yield. Due to the high leverage level, the company faces greater risk if any of its pipeline projects get stalled.

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Another large MLP trading at an attractive yield is MPLX (MPLX). The Marathon Petroleum (MPC) subsidiary is trading at a yield of ~7.7%. To learn more, read EPD, KMI, WMB, and MPLX: Comparing the Top Midstream Giants.

Yields above 10%

Since Marathon Petroleum acquired Andeavor, Andeavor Logistics (ANDX) continues to trade at a high yield. Currently, Andeavor is trading at a yield of 11.9%. EQM Midstream Partners (EQM), an MLP of Equitrans Midstream (ETRN), is trading at a yield of 10.3%. Equitrans Midstream completed the acquisition of all EQGP Holdings’ units in January.

Other stocks

Targa Resources (TRGP), Enable Midstream Partners (ENBL), Buckeye Partners (BPL), and Tallgrass Energy (TGE) are all trading at yields above 8%. The above graph shows the selected midstream stocks trading at high yields.

To learn about top MLPs with a conservative risk profile, read Top Three MLPs for Income Investors.


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