Back to top

Image: Bigstock

Enterprise Products Announces Quarterly Distribution Hike

Read MoreHide Full Article

Midstream energy service provider Enterprise Products Partners LP (EPD - Free Report) recently announced that it has received approval from the board of directors of its general partner to increase its quarterly cash distribution.  

The partnership will now pay a quarterly cash distribution of 41.5 cents per unit or $1.66 per unit on an annualized basis. This is 1.2% higher than the previous distribution of 41 cents and 5.1% above the prior-year quarter distribution of 39.5 cents. 

The increased distribution is expected to be paid on May 8, 2017, to unitholders on record as of Apr 28, 2017. Based on closing price of $27.50 per unit on Apr 5, 2017, the stock has a dividend yield of 6%.

Investors should know that this is the 60th distribution hike since the initial public offering of Enterprise Products in 1998. This is also the 51st successive quarterly distribution increase.

Houston, TX-based Enterprise Products is a leading master limited partnership (MLP) that provides a wide range of midstream energy services to producers and consumers of natural gas, natural gas liquids (NGL), and crude oil. The partnership is expected to report first-quarter 2017 earnings on May 2, 2017, before the opening bell. The Zacks Consensus Estimate for the quarterly earnings stands at 32 cents.

We continue to view Enterprise Products Partners as a core holding in an MLP portfolio, given its string of organic growth projects, potential acquisitions, strong balance sheet and solid liquidity position. The partnership is one of the largest fully integrated midstream service providers with a positive long-term outlook and significant geographic and business diversity.

Despite its strong fundamentals, the partnership’s units failed to outperform the Zacks categorized Oil/Gas Production Pipeline MLP industry in the last six months. During the aforesaid period, Enterprise Products’ stock gained 2.3% compared with 6.4% increase for the broader industry.

As a result, the partnership carries a Zacks Rank #3 (Hold).

Some better-ranked players in the energy sector include Antero Resources Corporation (AR - Free Report) , Pioneer Natural Resources Company (PXD - Free Report) and Energy Transfer Equity, L.P. . All the stocks sport a Zacks Rank #1 (Strong Buy).

Antero Resources’ earnings beat The Zacks Consensus Estimate in all the prior four quarters with an average positive earnings surprise of 239.10%. 

Pioneer Natural’s earnings surpassed the Zacks Consensus Estimate in three of the prior four quarters with an average positive earnings surprise of 21.86%. 

Energy Transfer is expected to witness year-over-year earnings growth of 42.12% in 2017.

Zacks’ Best Private Investment Ideas

In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?

Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>

Published in