This More Than 7%-Yielding Dividend Stock Is Making $670 Million of Acquisitions to Help Fuel a Monster Payment Boost for 2025

Core Viewpoint - Plains All American Pipeline is enhancing its income stream through strategic acquisitions and increased distributions, positioning itself as an attractive option for income-seeking investors [1][11]. Group 1: Distribution and Financial Performance - The MLP currently offers a distribution yield over 7%, significantly higher than the S&P 500's 1.2% [1]. - The company plans to increase its distribution by 20% this year, supported by recent deals that enhance cash flow [1][2]. - The MLP has improved its leverage ratio by 22% since 2021, with earnings growing at an 8% compound annual rate over the past three years [6][7]. Group 2: Acquisitions and Growth Strategy - Plains All American Pipeline is making three acquisitions totaling $670 million to enhance its crude oil footprint in key regions [2][9]. - The acquisitions include Ironwood Midstream Energy for $475 million, Medallion Midstream's Delaware Basin business for $160 million, and the remaining 50% interest in Midway Pipeline for $90 million [9]. - The company plans to invest $300 million to $400 million annually in high-return organic expansion projects [12]. Group 3: Future Outlook and Capital Management - The MLP aims for annual distribution growth of $0.15 per unit until it reaches its targeted payout ratio, with expectations to exceed this by boosting payouts by $0.25 per unit this year [8]. - The company has about $2.6 billion of preferred units that could be repurchased or refinanced, reducing future cash distributions [12]. - Continued growth drivers include organic expansion, streamlined operations, and further accretive acquisitions [10][12].