In this piece, we will take a look at the five best pipeline and MLP stocks to buy. For reasons that might make you consider this segment for your investment needs and more stocks, head on over to 11 Best Pipeline and MLP Stocks to Buy.
5. MPLX LP (NYSE:MPLX)
Number of Hedge Fund Holders: 7
MPLX LP (NYSE:MPLX) is a midstream assets infrastructure and logistics provider that serves the needs of the natural gas, oil, agricultural, and chemicals industries. The firm is headquartered in Findlay, Ohio, the United States.
MPLX LP (NYSE:MPLX) has a strong balance sheet, with its net leverage ratio of 3.3 providing comfort in a tough macroeconomic environment. The firm also trades at 8.6 times its forward operating income, indicating that the market has confidence in its shares. Finally, MPLX LP (NYSE:MPLX) also pays a 70 cent dividend for a 9% yield.
Insider Monkey surveyed 895 hedge funds for their June quarter of 2022 holdings to discover that seven had bought a stake in the company.
Out of these, Henry Breck’s Heronetta Management is MPLX LP (NYSE:MPLX)’s largest investor. It owns 435,337 shares that are worth $12.6 million.
4. Magellan Midstream Partners, L.P. (NYSE:MMP)
Number of Hedge Fund Holders: 9
Magellan Midstream Partners, L.P. (NYSE:MMP) is a crude oil transportation, storage, and distribution provider in the United States. The company transports refined petroleum products such as gasoline, aviation fuel, and kerosene to a host of different entities. It is headquartered in Tulsa, Oklahoma.
Magellan Midstream Partners, L.P. (NYSE:MMP) is America’s largest pipeline company, with the firm’s pipelines connected to close to half of the country’s refineries. The firm is also capable of storing an eye popping 100 million barrels of petroleum products.
Another key fact about Magellan Midstream Partners, L.P. (NYSE:MMP) is its fortress balance sheet. The latest metrics show that its debt to EBITDA ratio is at 3.7x, and all of its long term debt is maturing after 2025, and only 17% before 2030. All of these leave the firm in a very safe position. Magellan Midstream Partners, L.P. (NYSE:MMP) also pays a $1.04 dividend for an 8.69% yield. Insider Monkey’s Q2 2022 hedge fund survey covering 895 funds revealed that nine had invested in the company.
Magellan Midstream Partners, L.P. (NYSE:MMP)’s largest investor in our database is Jean-Marie Eveillard’s First Eagle Investment Management which owns 1.5 million shares that are worth $74 million.
3. Brookfield Infrastructure Partners L.P. (NYSE:BIP)
Number of Hedge Fund Holders: 18
Brookfield Infrastructure Partners L.P. (NYSE:BIP) is a diversified energy company involved in natural gas and electricity transmission. The firm transmits and transports both of these through its power lines and pipelines, and it also provides electricity and gas connections.
A key strength of Brookfield Infrastructure Partners L.P. (NYSE:BIP) is the fact that it is hedged from the seasonal fluctuation of energy demand. Since the firm provides both natural gas and electricity, when the demand for one drops (for example gas demand in summer), the demand for the other goes up. The company also supplies natural gas to Europe through tankers, which provides it with a key advantage in the aftermath of the Russian invasion of Ukraine, which has seen the continent struggle to meet its natural gas needs.
Brookfield Infrastructure Partners L.P. (NYSE:BIP) is performing well financially, with its revenue and cash flow growing by 30% and 23% annually over the past decade. It also pays a 36 cent dividend for a 4.18% yield. As this year’s June quarter ended, 18 out of the 895 hedge funds polled by Insider Monkey had invested in Brookfield Infrastructure Partners L.P. (NYSE:BIP).
Out of these, Robert Joseph Caruso’s Select Equity Group is Brookfield Infrastructure Partners L.P. (NYSE:BIP)’s largest investor. It owns 418,087 shares that are worth $15 million.
2. Enterprise Products Partners L.P. (NYSE:EPD)
Number of Hedge Fund Holders: 23
Enterprise Products Partners L.P. (NYSE:EPD) is an American company that engages in the processing and transportation of natural gas and crude oil. The firm owns natural gas processing facilities and trailer trucks to transport oil products. It is headquartered in Houston, Texas.
The second quarter of 2022 was an all round hit for Enterprise Products Partners L.P. (NYSE:EPD), as the firm saw both its natural gas pipeline volumes and marine terminal volumes grow. At the same time, its volumes for natural gas liquid fractionation also went up.
All these were evident in Enterprise Products Partners L.P. (NYSE:EPD)’s financial results, which saw its operating income, adjusted cash flow from operations, and free cash flows grow by 20%, 58%, and 26% annually, respectively. The company also pays a 47 cent dividend for a 7.6% yield. 23 out of the 895 hedge funds part of Insider Monkey’s Q2 2022 survey had held a stake in the company.
Enterprise Products Partners L.P. (NYSE:EPD)’s largest investor is Bruce Berkowitz’s Fairholme (FAIRX) which owns 3.5 million shares that are worth $87 million.
1. Targa Resources Corp. (NYSE:TRGP)
Number of Hedge Fund Holders: 32
Targa Resources Corp. (NYSE:TRGP) is an American midstream asset owner and developer. The company gathers, treats, processes, and transports natural gas, and it owns thousands of miles of gas pipelines and millions of barrels of storage capacity for natural gas liquids.
Targa Resources Corp. (NYSE:TRGP)’s second fiscal quarter saw its revenues increase by a whopping 77%, and this growth also translated into its bottom line profits, with the company’s net income growing by a whopping 983% during the same time period. To round off the results, Targa Resources Corp. (NYSE:TRGP)’s operating income also grew by 84% during Q2 2022.
Targa Resources Corp. (NYSE:TRGP) pays a 35 cent dividend for a 2.2% yield. As part of their second quarter of 2022 investments, 32 out of the 895 hedge funds polled by Insider Monkey had invested in the firm.
Out of these, Targa Resources Corp. (NYSE:TRGP)’s largest investor is Stuart J. Zimmer’s Zimmer Partners which owns 3.1 million shares that are worth $185 million.
Disclosure: None. You can also take a look at 10 Best Ethanol Stocks To Buy Now and 10 Best Nuclear Energy Stocks To Buy.
