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Due to extremely low interest rates and volatility in the markets, one of the most attractive and stable investments has been been high-yielding dividend stocks. Wells Fargo analyst Michael Blum follows Master Limited Partnerships (MLPs) and he expects very strong returns for this sector in 2012. In a recent article, Blum detailed the factors that support a very bullish year ahead for select MLP stocks, as follows:

Crude oil infrastructure development may still be in the early phases of a major buildout, implying the potential for significant new investment opportunities. MLPs focused on natural gas liquid production should see additional growth opportunities over time.

Read the article here.

The article goes on to state: "Wells Fargo’s projected return for 2012 consists of a 7.2% forward yield, distribution growth of 6.6% and valuation expansion of 3.2%." That would offer investors total returns of about 17.2% for 2012. Here's a closer look at 6 of MLP stocks favored by Wells Fargo analyst Blum:

Enbridge Energy Partners (NYSE:EEP) provides natural gas and crude oil pipeline and transportation services in the United States. This stock offers a strong dividend payout and yields about 7%. These shares look attractive for both the dividend and potential price appreciation, especially on any dips to about $26, which is a level the stock hit in October.

Here are some key points for EEP:

  • Current share price: $30.66
  • The 52 week range is $24.66 to $34.58
  • Earnings estimates for 2011: $1.42 per share
  • Earnings estimates for 2012: $1.60 per share
  • Annual dividend: $2.13 per share which yields 7%

Plains All American (NYSE:PAA) provides oil and natural gas pipelines, fuel storage, and transportation services. Plains All American stock has remained strong during market correction and is trading near 52 week highs amidst all the turmoil. A strong dividend yield of nearly 6% and a stable revenue source keeps this stock from large sell offs. This stock is trading near the 52 week high, so it makes sense to wait for dips.

Here are some key points for PAA:

  • Current share price: $68.08
  • The 52 week range is $54.90 to $68.28
  • Earnings estimates for 2011: $5.01 per share
  • Earnings estimates for 2012: $4.16 per share
  • Annual dividend: $3.98 per share which yields 5.9%

Enterprise Products Partners (NYSE:EPD) provides natural gas pipeline, storage and transportation services in the United States. This stock offers a strong dividend payout and yields about 7%. These shares look attractive, especially on dips to about $41, which is a level the stock hit in October. Chances are dividends will also grow with earnings and offer investors a hedge against inflation.

Here are some key points for EPD:

  • Current share price: $45.50
  • The 52 week range is $36 to $46.70
  • Earnings estimates for 2011: $2.10 per share
  • Earnings estimates for 2012: $2.28 per share
  • Annual dividend: $2.45 per share which yields 5.3%

BreitBurn Energy Partners (NASDAQ:BBEP) develops and produces natural gas and crude oil with projects in Michigan, California, Wyoming, Florida, and others. This stock offers a strong dividend payout and yields over 9%. These shares look undervalued, especially on any dips to about $16, which is a level the stock hit in October.

Here are some key points for BBEP:

  • Current share price: $17.62
  • The 52 week range is $15 to $23.14
  • Earnings estimates for 2011: $1.42 per share
  • Earnings estimates for 2012: $1.07 per share
  • Annual dividend: $1.74 per share which yields 9.6%

Teekay Offshore Partners (NYSE:TOO) provides marine transportation and storage for the oil industry. This stock offers a strong dividend payout and yields over 7%. This stock dipped to about $23 in August and again in October. If another bad day or week hits the markets, there might be another chance to buy this at that bargain level.

Here are some key points for TOO:

  • Current share price: $27.01
  • The 52 week range is $24.66 to $34.58
  • Earnings estimates for 2011: $1.59 per share
  • Earnings estimates for 2012: $1.52 per share
  • Annual dividend: $2 per share which yields 7.2%

Genesis Energy Partners (NYSE:GEL) provides natural gas and crude oil pipeline, refining, storage and transportation services in the United States. This stock offers a solid dividend payout and yields almost 7%. Wells Fargo analyst Blum thinks this stock might have more risk and it is trading at the highs of its recent trading range so I would wait for dips before considering this stock. These shares dipped to about $21.50 in both August and October, and those levels are certainly worth considering.

Here are some key points for GEL:

  • Current share price: $26.68
  • The 52 week range is $20.85 to $29.83
  • Earnings estimates for 2011: $1.09 per share
  • Earnings estimates for 2012: $1.44 per share
  • Annual dividend: $1.71 per share which yields 6.5%

Data is sourced from Yahoo Finance. No guarantees or representations are made. Hawkinvest is not a registered investment advisor and does not provide specific investment advice. The information is for informational purposes only. You should always consult a financial advisor.

Source: 6 MLPs Poised To Offer Robust Returns In 2012