Is Enterprise Products Partners (EPD) a High-Yield Passive Income Machine?

Enterprise Products Partners L.P. (NYSE:EPD) is included among the 10 Best Passive Income Stocks to Buy Now due to its dividend growth and high yield.

Is Enterprise Products Partners (EPD) a High-Yield Passive Income Machine?

Aerial view of a refinery tower surrounded by the sprawling landscape of pipelines in an oil & gas midstream facility.

On July 9, the company declared a 2% hike in its quarterly dividend to $0.545 per share. Through this increase, the company stretched its dividend growth streak to 29 years.

In the first quarter of 2025, Enterprise Products Partners L.P. (NYSE:EPD) reported distributable cash flow (DCF) of $2.0 billion in the first quarter of 2025, marking a 5% rise from the $1.9 billion it posted in the same period last year. DCF covered the distribution 1.7 times over for the recent quarter, allowing the company to retain $842 million in cash flow. Its adjusted cash flow from operations (CFFO) came in at $2.1 billion for the first quarter of both 2025 and 2024. For the twelve-month period ending March 31, 2025, adjusted CFFO totaled $8.6 billion. During that same period, the company’s payout ratio— which includes distributions to common unitholders and share buybacks— stood at 56% of adjusted CFFO.

In addition to dividend growth, Enterprise Products Partners L.P. (NYSE:EPD) also offers a solid dividend yield, which stands at 6.71%, as of July 10. The company ranks among the largest publicly traded partnerships and is a key midstream energy provider in North America, offering essential services to both producers and consumers of natural gas, natural gas liquids (NGLs), crude oil, refined products, and petrochemicals.

While we acknowledge the potential of EPD to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than EPD and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.