Analysts differ on whether MLPs are on shaky ground after Boardwalk blowup

|About: Boardwalk Pipeline Partners... (BWP)|By:, SA News Editor

Monday's stunning descent of Boardwalk Pipeline Partners (BWP +1.2%) is a reminder that "equity in MLPs is not necessarily safe [and] dividends are not necessarily secure," according to Josh Young, who notes that BWP's underlying business shifted despite a long track record of raising dividend levels.

Young thinks Kinder Morgan Partners (KMP -0.9%) could be a risky investment too, though the stock has held up so far in the wake of BWP's news: KMP could now face issues similar to BWP, "as production shifts to different parts of the countries, making certain pipelines less valuable or even potentially obsolete."

Albert Alfonso, however, thinks many of BWP's problems are company specific and not widespread among other midstream MLPs; BWP's assets are concentrated in areas where natural gas has long been in decline and it needed to use internal cash flow to fund growth capex projects given its poor financial metrics.