Introduction
Following the turmoil of 2020, the last thing that anyone wanted at the start of 2021 was further turbulence but unfortunately for certain organizations, the severe Winter storm in Texas dubbed Uri brought this during
EnLink Midstream: The 8% Yield Could Be 16% One Day Despite The Bumpy Start To 2021
Summary
- EnLink Midstream saw a bumpy start to 2021 during the first quarter thanks to the severe Winter storm in Texas but thankfully this was only temporary.
- On the surface, it appears that their operating cash flow increased year on year but this was simply due to working capital movements and thus it was actually down significantly.
- Whilst their operating income and EBITDA also held up well, these were due to the non-cash income stemming from utility credits for unused electricity during the storm.
- When looking towards the future, their guidance and healthy financial position provide them scope even double their already high distribution yield to a massive 16% one day.
- Whilst no one can know for certain when management might increase their distributions in the future, given this solid base, it should be no surprise that my bullish rating is being maintained.
I primarily focus on income investments, as well as deep value and contrarian opportunities.
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