Randall Breitenbach And Hal Washburn Want To Pay You 9.8% On Your Investment ( $BBEP )
We are constantly looking for great oil & gas stocks. What’s better then well structured, proper managed oil & gas stock? Oil & gas stocks that pay strong dividends. We believe there is considerable upside for these stocks as demand for oil continues to push up prices and natural gas stabilizes going into 2013. With this upside, finding the right dividend to match the upside is a strong investment strategy, one we are following. BrietBurn Energy Partners L.P. ($BBEP) is an excellent example of this type of security. Our research picked up on 4 reasons this should be a BUY.
1) BreitBurn Energy Partners is an independent oil and gas limited partnership. It acquires and develops oil and gas properties. It has major projects located in California, Wyoming, Florida, Texas, Michigan, Kentucky and Indiana. While energy could see some reduced demand in a weak economy, it is not going away anytime soon, and that is why BreitBurn has a solid business model.
2) BreitBurn is set up as a limited partnership that is focused on paying out the cashflow it generates to shareholders. That is what allows this investment to pay an extraordinary yield of nearly 10%.
3) This company recently raised its quarterly cash distribution to 46 cents per share, which will be payable on August 14, 2012 to the record holders of common units on August 10, 2012. The distribution has been rising since May 2010, when it was 37.5 cents. Dividend growth is an important factor for investors to consider, and this trend could continue as BreitBurn expands.
4) The shares appear undervalued in terms of yield. For example, major oil stocks like Exxon (XOM) only offer a dividend yield of about 2.6%. Other well-known dividend stocks in the oil and gas industry like Kinder Morgan, Inc. (KMI) offers a current dividend yield of about 3.9%. This means BreitBurn is on the upper end of the yield range for this sector, and the payout compares to companies like Seadrill (SDRL), which yields about 8.4% and has been trending higher.
This is not an offer to buy or sell securities. Oil investment carries with it very high risks. The information contained within this site has not been nor will it be verified by Envestor First and is subject to change at any time. We are not a United States Securities Dealer or Broker or United States Investment Adviser. Do your own due diligence and consult with a licensed professional before making any investment decisions. Please read our full disclaimer before making any decisions.