2 Bargain Basement Stocks to Buy on the Dip
The midstream sector, which owns the energy infrastructure that helps move oil and natural gas, was once growing at a rapid clip. That's no longer the case, and Wall Street has punished industry participants. However, there's long-term opportunity in the sector for investors that are trying to maximize the income they generate from their portfolios. Two of the most attractive stocks to buy during this industry's long dip are Enterprise Products Partners (NYSE: EPD) and Enbridge (NYSE: ENB). Here's a quick look at each of these high yielders.
Enterprise Products Partners is a master limited partnership (MLP), a business structure designed to pass income on to investors in a tax efficient manner. It comes with some tax headaches, most notably the need to deal with a K-1 form come tax time. You might want to consult a tax specialist if you buy it. But what you'll get for that extra effort is a huge 7.6% distribution yield.
That's not the whole story, however. The distribution has been increased annually for 25 consecutive years. The annualized increase over that span was roughly 7%. The MLP also has an investment-grade-rated balance sheet. And it happens to be one of the largest midstream players in North America, so it has the scale and strength to be an industry consolidator.
Source Fool.com
