Consistent growth over the years---EPD, MMP, and MPLX | MLPs Message Board Posts


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Msg  136588 of 137794  at  4/18/2022 9:51:12 AM  by

tulsatea


Consistent growth over the years---EPD, MMP, and MPLX

 

Motley Fool--Oil and gas stocks tend to be volatile, thanks to their dependence on oil prices. However, there are companies in this sector that have shown consistent growth over years. Three such companies are Enterprise Products Partners ( EPD 0.07% ), Magellan Midstream Partners ( MMP 0.08% ), and MPLX ( MPLX -0.43% ). Cash from operations for all three companies is largely on an upward trend for more than a decade.

EPD Cash from Operations (Annual) Chart

EPD CASH FROM OPERATIONS (ANNUAL). DATA BY YCHARTS.

All three generate a major chunk of their operational cash flow from long-term, fee-based contracts for transporting and storing oil, gas, and related products. These contracts are not directly dependent on the prices of commodities. And contracts structured to protect the companies from commodity price fluctuations and demand changes help Enterprise, Magellan, and MPLX generate steady cash flow.

Other factors contributing to the companies' consistent growth include huge and diversified asset bases and financial discipline.

In addition to funding growth projects, all three distribute a chunk of their cash flow to shareholders. As of this writing, Magellan's stock is trading at an alluring dividend yield of nearly 8.3% while MPLX offers a yield of 8.1%. Enterprise stock has a yield of 6.9%.
 
While these companies have historically generated growing cash flow, investors today are concerned about their ability to continue doing so. But the concerns might be overblown. Not only is the demand for oil here to stay, but energy companies also are finding ways to participate in clean energy growth. 
 

EPD Dividend Yield Chart

EPD DIVIDEND YIELD. DATA BY YCHARTS.

 
 
 


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