Magellan Midstream Partners Yields 8.5% And Is Buying Back Units

Summary

  • Magellan Midstream Partners is trading like energy prices are not at historic highs.
  • MMP yields 8.5% all while executing on an aggressive unit repurchase program - though unit repurchases should slow moving forward.
  • I can see units delivering market-beating returns due to the low valuation and conservative growth.
  • Units are highly buyable here with a double-digit total shareholder yield.
  • Looking for a portfolio of ideas like this one? Members of Best Of Breed get exclusive access to our model portfolio. Learn More »

Oil, Gas Or Water Transportation With Pipe Line Valves On Grass.

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Magellan Midstream Partners (MMP) finds itself yielding nearly 8.5%, a blistering yield for what has proven to be a consistent dividend grower. That high yield is even more surprising when considering the strong environment for the energy sector, one which

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This article was written by

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Julian Lin is a financial analyst. He finds undervalued companies with secular growth that appreciate over time. His approach is to look for companies with strong balance sheets and management teams in sectors with long growth runways.

Julian is the leader of the investing group Best Of Breed Growth Stocks where he only shares positions in stocks which have a large probability of delivering large alpha relative to the S&P 500. He also combines growth-oriented principles with strict valuation hurdles to add an additional layer to the conventional margin of safety. Features include: exclusive access to Julian's highest conviction picks, full stock research reports, real-time trade alerts, macro market analysis, individual industry reports, a filtered watchlist, and community chat with access to Julian 24/7. Learn more.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I am long all holdings of the Best of Breed portfolio.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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