I’m always on the lookout for a great income stock to own. I’ve never been a bond guy, though I understand their place in investor’s hearts. I just think we can do much better with equities that have a big yield that’s likely to grow over time. Even though we’re fishing at the boring end of the pond, I’d still prefer to invest in a company that’s doing something unique.
By now, almost every investor is familiar with the large distributions from midstream master limited partnerships. Pipeline companies such as Enterprise Products Partners L.P. (NYSE:EPD) have rewarded investors with a steady, growing distribution. Enterprise’s distribution is better than most, as it;s now grown for 34 straight quarters. The thing is, every investor already knows the midstream MLPs, so If you’re bored with your current boring income providers, here are three unique companies to put on to your watchlist.
Fishing further upstream
All that oil and gas that flows through the pipes at Enterprise Products Partners L.P. (NYSE:EPD) Partners has to come from somewhere. While most oil and gas wells are owned by traditional exploration and production companies, a growing number of mature wells are being snapped up by upstream MLPs such as BreitBurn Energy Partners L.P. (NASDAQ:BBEP) .
The partnership has a high-quality asset base of predictable, long-lived production that’s estimated to have 18 years of reserve life left. Beyond that, revenue is not likely to dry up, as the company has several low-risk organic production growth opportunities and vast acquisition potential. That outlook leads the company to believe it can continue to grow its distribution to investors by about 5% each year. Add that to a current distribution of nearly 10%, and it’s enough to make any income-focused investor salivate.
Building a solid foundation from sand
One of the reasons BreitBurn Energy Partners L.P. (NASDAQ:BBEP) is able to acquire mature oil and gas properties is because most exploration and production companies are focusing capital to drill more expensive wells only possible by fracking. The thing with fracking is that it requires a whole lot of sand to get the job done.