Lackluster Earnings Mean These 2 Cheap High-Yield Stocks Probably Can't Grow Their Dividends Right Now
Energy infrastructure companies Targa Resources (NYSE: TRGP) and CorEnergy Infrastructure Trust (NYSE: CORR) both have something that would catch the eye of income-focused investors: a yield north of 8%. One reason both stocks have such elevated payouts is that they trade at relatively cheap prices. CoreEnergy, for example, sells for less than 10 times cash flow, while Targa goes for around 13 times, both below the mid-teens multiple of their peer group.
However, the reason both sell for such low prices is that neither appears to be in the position to increase their payouts anytime soon. For evidence, we need only look at their rather lackluster third-quarter results.
While investors should continue collecting these lucrative dividends, neither company appears to be in a position hand out any more cash. Image source: Getty Images
Source: Fool.com
Targa Resources Corp. Stock
The stock is an absolute favorite of our community with 29 Buy predictions and no Sell predictions.
On the other hand, the target price of 131 € is below the current price of 132.9 € for Targa Resources Corp., so the potential is actually -1.43%.
