6 American Small Cap Oil and Gas Equities Currently Yielding Over 7%

by: Zvi Bar

A seven percent yield is high in this market, especially when you consider that these equities are dealing in oil and gas, and that higher oil prices or demand tend to be positives for petroleum explorers, drillers and sometimes even refiners (and vice-versa, of course, if petroleum prices go down).

Many of these companies have moved up quite a bit over the past two years, so investors should be wary of buying high. Also, several of these stocks stalled through the last few months as these companies thrive on stability within oil price, supply and demand.

The following is a list of the six American small-cap oil and gas stocks that currently yield over 8%, listed in alphabetical order:

  1. Breitburn Energy Partners L.P. (BBEP)
    • Yield: 8.3%
    • 2011-to-date Performance: -1.54%
  1. Calumet Specialty Products Partners LP (NASDAQ:CLMT)
    • Yield: 8.3%
    • 2011-to-date Performance: 9.25%
  1. Encore Energy Partners LP (NYSE:ENP)
    • Yield: 8.8%
    • 2011-to-date Performance: 1.25%
  1. Ferrellgas Partners LP (NYSE:FGP)
    • Yield: 9.1%
    • 2011-to-date Performance: -12.33%
  1. Martin Midstream Partners LP (NASDAQ:MMLP)
    • Yield: 7.6%
    • 2011-to-date Performance: -0.05%
  1. MV Oil Trust (NYSE:MVO)
    • Yield: 9.1%
    • 2011-to-date Performance: 11.89%

Within 2011, BBEP, ENP and MMLP are fairly flat. CLMT and MVO are both up between 9% and 12%, while FGP is down about 12%. Five out of six of these small caps are up this year if you factor in distributions, but only three (half) are up if you do not. Click to enlarge:

Do note that these are not standard corporations, but Master Limited Partnerships and a Trust. Partnerships do not pay the standard dividends that would normally generate a 1099 tax form. Instead, they pay distributions and produce K-1 forms, and they may not be suitable for retirement accounts depending on the size of the annual distribution (please consult your accountant if you are unfamiliar with MLP and Partnership suitability for your account).

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Disclaimer: This article is intended to be informative and should not be construed as personalized advice as it does not take into account your specific situation or objectives.

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