So far this year, Altria Group Inc. (NYSE: MO) has offered a benefit that is relatively unusual for high-yield stocks. ...

Core Viewpoint - Investing in leading pipeline master limited partnerships (MLPs) can generate significant monthly dividend income, with a suggested investment of $50,000 in each of three companies potentially yielding $1,000 per month in total distributions. Group 1: Industry Overview - The pipeline sector operates similarly to a toll road business, where energy prices have minimal direct impact on operational results and cash flows [2] - Current favorable market conditions and attractive historical valuations make this an opportune time to invest in pipeline stocks for high yields [2] Group 2: Energy Transfer - A $50,000 investment in Energy Transfer (ET) yields approximately $3,800 annually, translating to over $315 monthly [4] - The company's distribution is well-supported by a robust distributable cash flow coverage ratio of 1.7 times [4] - Energy Transfer has improved its balance sheet, reducing leverage to the low end of its targeted range [5] - About 90% of Energy Transfer's 2025 EBITDA is expected from fee-based contracts, minimizing energy price risk [6] - The company anticipates a distribution growth of 3% to 5% annually [7] Group 3: Enterprise Products Partners - A $50,000 investment in Enterprise Products Partners (EPD) generates about $3,450 annually, or over $287 monthly [8] - The company has consistently increased its distribution for 27 consecutive years, with a coverage ratio of 1.6 times and leverage of 3.1 times [9] - Approximately 80% of Enterprise's business relies on fee-based contracts, often with take-or-pay provisions [10] - The company raised its distribution by 3.8% year over year last quarter, indicating potential for future increases [10] Group 4: Western Midstream Partners - Investing $50,000 in Western Midstream Partners (WES) yields about $4,750 annually, or approximately $400 monthly [11] - The company's distribution is well-covered by cash flows, with leverage below 3 times [12] - Western Midstream primarily serves its parent company, Occidental Petroleum, providing strong visibility into cash flows [12] - The company is expanding its produced water business through acquisitions and organic projects, including a $2 billion deal for Aris Water Solutions [13] - Western Midstream aims to grow its distribution by mid to low single-digit percentages [13] Group 5: Conclusion - Energy Transfer, Enterprise Products Partners, and Western Midstream are attractive pipeline stocks with solid balance sheets, positioned for continued distribution growth [14]

Core Viewpoint - Dividend investors should consider energy companies for high yields, as they provide essential services and have a history of increasing dividends [1][8] Group 1: Black Hills - Black Hills (BKH) serves approximately 1.35 million customers across several states and offers a 4.5% dividend yield, having increased its dividend for 55 consecutive years [2][3] - The company's customer growth rate is nearly three times that of the U.S. population growth, supported by a $4.7 billion capital investment budget [3] - Management anticipates earnings growth of 4% to 6% year-over-year, which should support continued dividend increases [3] Group 2: Chevron - Chevron (CVX) provides a 4.9% dividend yield and has increased its dividend for 38 consecutive years, outperforming the average energy stock yield of 3.1% [4][5] - The company's diversified business model includes upstream, midstream, and downstream operations, which helps mitigate the volatility of oil prices [5] - Chevron maintains a low debt-to-equity ratio of approximately 0.15%, allowing flexibility to manage debt regardless of oil price fluctuations [5] Group 3: Enterprise Products Partners - Enterprise Products Partners (EPD) operates a significant midstream business in North America, focusing on pipelines and storage, with a distribution yield of 6.8% [6][7] - The company has increased its distribution for 26 consecutive years, supported by a $7.6 billion capital investment plan [7] - Distributable cash flow covered the distribution by 1.7 times in 2024, providing a buffer against potential downturns [7]