Many on Wall Street feel that AEP stock trades at a discount to its utility peers, and they feel it deserves a premium. Top analysts also think the company may sell generating assets and buy back shares with the proceeds, which also will be accretive.
Shareholders receive a 4.09% dividend. Morgan Stanley has a $101 price target, while the consensus target for American Electric Power stock is $97.82. Shares closed on Wednesday at $79.19.
Energy Transfer
This top master limited partnership is a safer play for investors looking for energy exposure and income. Energy Transfer L.P. (NYSE: ET) owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with a strategic footprint in all the major domestic production basins.
The company is a publicly traded limited partnership with core operations that include complimentary natural gas midstream, intrastate and interstate transportation and storage assets; crude oil, natural gas liquid (NGL) and refined product transportation and terminaling assets; NGL fractionation; and various acquisition and marketing assets.
After the purchase of Enable Partners in December of 2021, Energy Transfer owns and operates more than 114,000 miles of pipelines and related assets in all the major U.S. producing regions and markets across 41 states, further solidifying its leadership position in the midstream sector.
Through its ownership of Energy Transfer Operating (formerly known as Energy Transfer Partners), the company also owns Lake Charles LNG, as well as the general partner interests, the incentive distribution rights and 28.5 million common units of Sunoco and the general partner interests, and 39.7 million common units of USA Compression Partners.
Energy Transfer stock comes with a 9.72% distribution. Morgan Stanley has set a $17 price target. The consensus target is $17.21, and shares closed almost 2% higher on Wednesday at $12.77.
EPR Properties
This real estate investment trust (REIT) invests in some of the most popular entertainment companies. EPR Properties Inc. (NYSE: EPR) is a leading experiential net lease REIT, specializing in select enduring experiential properties in the real estate industry.
The company is focused on real estate venues that create value by facilitating out-of-home leisure and recreation experiences in which consumers choose to spend their discretionary time and money. It has nearly $6.7 billion in total investments across 44 states. The company adheres to rigorous underwriting and investing criteria centered on key industry-, property- and tenant-level cash flow standards, and it believes its focused approach provides a competitive advantage and the potential for stable and attractive returns.
The distribution yield here is 7.96%. The $54 JMP Securities target price is well above the consensus target of $43.71. EPR Properties stock closed trading on Wednesday at $43.28.
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