Below we compiled a list of high dividend energy stocks with low beta. All companies have at least $5 billion market cap, dividend yield of at least 4%, and beta lower than 1. The market data is sourced from Finviz and the sector classification is obtained from Fidelity. We are long-tem bullish about energy prices and we believe the U.S. dollar will lose value in real terms. We also agree with Warren Buffett that Treasury bonds aren't good investments at the moment. We believe one of the best alternatives for conservative income investors is energy storage and transportation stocks. Most of these stocks yield more than 5%.
Buckeye Partners LP
Boardwalk Pipeline Partners, LP
Enbridge Energy Partners LP
El Paso Pipeline Partners, L.P.
Enterprise Products Partners LP
Energy Transfer Equity, L.P.
Energy Transfer Partners LP
Kinder Morgan Energy Partners LP
Linn Energy, LLC
Magellan Midstream Partners LP
ONEOK Partners, L.P.
Plains All American Pipeline, L.P.
Among these 12 stocks, Kinder Morgan Energy Partners LP and Enterprise Products Partners LP have the largest market cap. They are the only two stocks on the list above with market cap of over $20 billion. Large cap stocks are usually followed by more investors compared with small cap stocks. Therefore, we are going to discuss in detail about these two stocks.
Kinder Morgan is a pipeline transportation and energy storage company in North America. Its beta is 0.37 and its dividend yield is 5.42%. The company recently increased its quarterly dividend from $1.15 per share to $1.16 per share, which was paid to its shareholders in mid November. Kinder Morgan has a market cap of $28.5B. We like Kinder Morgan. It has a diversified asset portfolio and stable businesses. It also has a history of increasing its cash distributions. The company has also been increasing its dividend payouts for 15 consecutive years. The stocks that have a reputation of increasing dividend payments generally keep doing so even in turbulent times. Since Kinder Morgan kept increasing its dividends during the 2008-2009 market collapse, we think it is very likely that investors will enjoy higher dividend yields down the road.
Another large cap high dividend energy stock with low beta is Enterprise Products Partners LP. It has a market cap of $44B. Enterprise Products is a North American midstream energy company. It provides a wide range of services to producers and consumers of natural gas, natural gas liquids, crude oil, refined products and certain petrochemicals. Enterprise Products has a beta of 0.58 and a high dividend yield of 4.97%. The company has been raising its dividend payouts for 14 consecutive years. Recently it increased its quarterly dividend from $0.6050 to $0.6125 per share, which was paid to its shareholders in early November. We are bullish about Enterprise Products too. This is definitely a much better alternative to 10-year Treasuries or bank CDs that yield less than 2% for long-term income investors.
Other large cap high dividend energy stocks with low beta include Boardwalk Pipeline Partners LP , Buckeye Partners LP, Enbridge Energy Partners LP, El Paso Pipeline Partners LP, Energy Transfer Equity LP, Energy Transfer Partners LP, Linn Energy LLC, Magellan Midstream Partners LP, ONEOK Partners LP, and Plains All American Pipeline LP. Investors looking for diversification can add some of these names into their portfolios. We prefer larger-cap stocks with histories of consistent dividend increases. These are more stable and reliable in terms of dividend payments.