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Hoegh LNG Partners: Small-Cap MLP Priced For Double-Digit Total Returns

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Written by Nick McCullum on July 6th, 2017, for Sure Dividend.

When investors think about investing in master limited partnerships, the first subsector that likely comes to mind is midstream energy companies – operators of pipelines and storage vessels.

What investors likely don’t think of is marine-based vessel transportation partnerships. There is a reason for this. It is a relatively small market with one MLP holding a dominant leadership position.

That MLP is Hoegh LNG Partners LP (NYSE:HMLP), which trades on the New York Stock Exchange and has a market capitalization of $647 million.

What immediately stands out about this partnership is its exceptionally high dividend yield. Hoegh LNG Partners currently trades with a yield of 8.9%, more than 4.5x the average yield in the S&P 500.

Hoegh LNG Partners is one of a short list of stocks with 5%+ dividend yields, ideal for investors looking to generate meaningful portfolio income.

Hoegh LNG Partners also has other appealing characteristics. As an MLP, the company’s distributions are highly tax-efficient.

In fact, master limited partnerships are the most effective investment vehicle for generating after-tax income, primarily because they avoid paying tax at the organizational level.

Hoegh LNG Partners’ high dividend yield and tax efficiency make it an appealing investment for investors looking to synthesize a passive income stream from their nest egg.

This article will analyze the investment prospects of Hoegh LNG Partners in detail.

Business Overview

Hoegh LNG Partners is a publicly-traded master limited partnership that provides floating, marine-based liquid natural gas [LNG] transportation services under long-term contracts.

The partnership owns and operates five floating storage and regasification units (FSRUs) which act as floating import terminals. Hoegh LNG Partners is the only pure play FSRU company in the public markets and owns the most modern FSRU fleet.

Hoegh’s general partner is

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Sure Dividend helps individual investors find high quality dividend growth stocks with strong competitive advantages suitable for long-term holding. The authors who write for Sure Dividend on Seeking Alpha are as follows:Bob CiuraBen ReynoldsJosh Arnold

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