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Comparing Cheniere Energy Partners’ Yield with Its Peers’

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Cheniere Energy Partners’ yield

Cheniere Energy Partners (CQP), Cheniere Energy’s MLP subsidiary, is currently trading at a distribution yield of 5.6%, lower than its five-year average yield of 6%.

It’s also markedly lower than the Alerian MLP ETF’s (AMLP) yield of 8%.

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Cheniere Energy Partners has increased its distribution by 5.2% compounded annually in the last five years. CQP’s coverage ratio is ~1.5x, higher than the peer average.

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In general, higher yields can signal higher risk, and investors expect superior returns for assuming such risk. Stock appreciation and higher distributions make MLPs attractive options from a total return perspective. As a result, investors looking for regular dividend income find this segment attractive.

In comparison, CQP’s peers Buckeye Partners (BPL) and NGL Energy Partners (NGL) yield 8.6% and 11%, respectively.

To learn more about how energy midstream stocks have fared recently and where they might go from here, read Midstream Stocks Outperformed Broader Markets in Q1.

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