From Nasdaq: 2025-03-22 06:20:00

Income-seeking investors look for high dividend yields, but should that be the sole factor in investment decisions? Energy Transfer offers a 6.9% distribution yield, while Enterprise Products Partners and Enbridge offer 6.3% and 5.9% respectively. However, Energy Transfer cut its dividend by 50% in 2020, unlike the consistent payouts from Enterprise and Enbridge. These companies charge fees for energy asset use, ensuring reliable cash flow. While Energy Transfer’s yield may be tempting, investors should consider the stability of payouts from Enterprise and Enbridge before investing.

Energy Transfer’s 2020 dividend cut contrasts with Enterprise and Enbridge’s steady increases. Both companies have a history of growing income streams, with Enterprise increasing distributions for 26 years and Enbridge increasing dividends for 30 years. While all three firms operate similarly, Energy Transfer’s past cut raises concerns about income reliability. Investors should focus on sustainable income from Enterprise and Enbridge, as their strong finances and track record make them better options for consistent returns.

Before investing in Energy Transfer, consider the advice from the Motley Fool Stock Advisor team. While Energy Transfer may have a high yield, it wasn’t among their top 10 stock picks. Past recommendations like Nvidia have seen significant returns, highlighting the potential for growth with their picks. Investors can benefit from the guidance and stock picks provided by Stock Advisor, which has outperformed the S&P 500 since 2002. Consider the long-term potential of other stocks before deciding where to invest.



Read more at Nasdaq: The Smartest High-Yield Midstream Stocks to Buy With $100 Right Now