One reason many analysts may have a liking for Enterprise Products Partners stock might be its distribution coverage ratio. This ratio is well above 1 times, making it relatively less risky among the MLPs.
Investors receive a 7.22% distribution. The $33 UBS price target compares with a consensus price target of $31.47. Enterprise Products Partners stock closed on Tuesday at $26.25.
Exxon Mobil
Despite the huge rally in oil this year, this mega-cap energy leader trades at levels printed in 2015 and still offers investors an excellent entry point. Exxon Mobil Corp. (NYSE: XOM) is the world’s largest international integrated oil and gas company. It explores for and produces crude oil and natural gas in the United States, Canada, South America, Europe, Africa and elsewhere.
Exxon also manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and specialty products, and it transports and sells crude oil, natural gas and petroleum products.
Top Wall Street analysts expect Exxon to remain a key beneficiary in this higher oil price environment, and most remain strongly positive about the company’s sharp positive inflection in capital allocation strategy, upstream portfolio, and leverage to a further demand recovery, with Exxon Mobil offering greater downstream/chemicals exposure relative to peers.
Exxon Mobil stock investors receive a 3.68% dividend, which will continue to be defended. BofA Securities has set a $120 price target. The consensus target is lower at $103.63. Tuesday’s close was at $94.95 a share.
Hess Midstream
This is the limited partnership midstream arm of one of the country’s top energy companies. Hess Midstream L.P. (NYSE: HESM) owns, develops, operates and acquires midstream assets. The company operates through three segments.
The Gathering segment owns natural gas gathering and crude oil gathering systems, as well as produced water gathering and disposal facilities. Its gathering system consists of approximately 1,350 miles of high and low pressure natural gas and natural gas liquids gathering pipelines with capacity of approximately 450 million cubic feet per day, and the crude oil gathering system comprises approximately 550 miles of crude oil gathering pipelines.
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