In this article, we discuss the 5 best pipeline and MLP stocks to buy. If you want to read our detailed analysis of the industry, go directly to read the 11 Best Pipeline and MLP Stocks To Buy.
5. Enterprise Products Partners L.P. (NYSE:EPD)
Number of Hedge Fund Holders: 28
Enterprise Products Partners L.P. (NYSE:EPD) is an American midstream natural gas and crude oil pipeline company, which also operates as an MLP. The company maintained its distribution efficiently during the pandemic, compared with its peers.
Recently, BofA reinstated its coverage on Enterprise Products Partners L.P. (NYSE:EPD) with a ‘Buy’ rating and a $32 price target.
Of the 873 hedge funds tracked by Insider Monkey, 28 hedge funds have positions in Enterprise Products Partners L.P. (NYSE:EPD)in Q2 2021, up from 26 in the previous quarter. The total value of these stakes is $246 million.
ClearBridge Investments mentioned Enterprise Products Partners L.P. (NYSE:EPD) in its first-quarter 2021 investor letter. Here is what the firm has to say:
“While reducing in health care and consumer staples, we increased our exposure to high-quality names in economically sensitive areas of the market. We added to low-cost, high-quality energy names (including) Enterprise Products Partners LP. We are positive on this company’s strong balance sheets, competitive positions and exposure to an economic recovery.”
4. Energy Transfer LP (NYSE:ET)
Number of Hedge Fund Holders: 29
Energy Transfer LP (NYSE:ET) is a publicly-traded MLP, engaged in natural gas and propane pipeline transport. It is one of the largest and diversified midstream service providers in the U.S.
In September, Citigroup raised its price target on Energy Transfer LP (NYSE:ET) to $15, while keeping a ‘Buy’ rating on the shares. In the same month, Tudor Pickering upgraded the stock to ‘Buy’ from ‘Hold’, with a $14 price target.
As of Q2 2021, 29 hedge funds tracked by Insider Monkey have stakes in Energy Transfer LP (NYSE:ET), compared with 25 in the previous quarter. These stakes are valued at $835.2 million.
Miller Value Partners mentioned Energy Transfer LP (NYSE:ET) in its second-quarter 2021 investor letter. Here is what the firm has to say:
“Energy Transfer LP (ET)rose over the period along with the price of oil climbing 40.59% over the period. The company received positive news that the Dakota Access Pipeline project would not be shut down while the Environmental Impact Statement by the US Army Core of Engineers is drawn up. Energy Transfer reported strong 1Q results with revenue of $17B surpassing expectations for $11.8B with adjusted earnings before income, taxes, depreciation and amortization (EBITDA) hitting $5.04B ahead of consensus of $2.77B. The company raised full year adjusted EBITDA guidance to $12.9-13.3B from $10.6-11.0B previously, with the increase largely related to the benefits realized from Winter Storm Uri. The company paid down $3.7B in debt during the quarter, using strong cash f low to reduce leverage. The company also announced the issuance of $900M in 6.5% Series H perpetual preferreds with the company using the proceeds to repay debt and for general purposes.”
3. Kinder Morgan, Inc. (NYSE:KMI)
Number of Hedge Fund Holders: 38
Kinder Morgan, Inc. (NYSE:KMI) is one of the largest infrastructure companies in North America that owns oil and gas pipelines and terminals. Currently operating as a pipeline company, Kinder Morgan, Inc. (NYSE:KMI) brought all its units under one company by abandoning MLP.
On September 13, Kinder Morgan, Inc. (NYSE:KMI) announced its partnership with Finnish renewable fuels firm, Neste, for the development of a U.S. raw material storage and logistics hub to support the production of renewable diesel. In Q2 2021, Kinder Morgan, Inc. (NYSE:KMI) posted an EPS of $0.23, beating the estimates by $0.04. The company’s revenue for the quarter stood at $3.1 billion, presenting a 23% year-over-year growth.
As of Q2 2021, 38 hedge funds tracked by Insider Monkey have positions in Kinder Morgan, Inc. (NYSE:KMI), valued at over $1.03 billion. The number of hedge funds having stakes in the company was the same in the previous quarter. With 19.7 million shares worth $359.6 million, FPR Partners is the company’s leading shareholder.
2. The Williams Companies, Inc. (NYSE:WMB)
Number of Hedge Fund Holders: 39
The Williams Companies, Inc. (NYSE:WMB) is an American energy company involved in the processing and transportation of natural gas.
On September 22, The Williams Companies, Inc. (NYSE:WMB) signed an agreement with Danish renewables company Orsted to co-develop hydrogen or synthetic natural gas facilities powered by renewable energy. The joint agreement will consider large-scale wind energy. In Q2 2021, The Williams Companies, Inc. (NYSE:WMB) reported revenue of $2.28 billion, beating the estimates by $210 million and showcasing a 28.1% growth from the prior-year quarter. Recently, BofA reinstated the coverage of The Williams Companies, Inc. (NYSE:WMB) with a ‘Buy’ rating and a $31 price target.
As of Q2 2021, 39 hedge funds tracked by Insider Monkey have positions in The Williams Companies, Inc. (NYSE:WMB), up from 34 in the previous quarter. The total value of these stakes is $551 million.
Longleaf Partners Fund recently mentioned The Williams Companies, Inc. (NYSE:WMB) in its second-quarter 2021 investor letter. Here is what the firm has to say:
“Williams (14%, 0.51%), the natural gas pipeline operator, was also a positive contributor. The value grew slowly but steadily thanks to continued cash flow growth at Williams’s main Transco pipeline, as well as good volume trends (up 11% YOY) in its Northeast assets. The stock traded up with gas price strength as the quarter went on. We believe that management is open to more transactions to grow and simplify value per share, and as industry conditions improve, this becomes more likely.”
1. Cheniere Energy, Inc. (NYSE:LNG)
Number of Hedge Fund Holders: 49
Cheniere Energy, Inc. (NYSE:LNG) is an American MLP, which owns one of the largest liquid natural gas (NLG) terminals in Louisiana, U.S., making it one of the best pipeline and MLP stocks to buy now.
In Q2 2021, Cheniere Energy, Inc. (NYSE:LNG) reported revenue of $3.02 billion, showcasing a 25.8% year-over-year growth. The company’s adjusted EBITDA for the quarter stood at $1 billion. For FY21, Cheniere Energy, Inc. (NYSE:LNG) raised its guidance of adjusted EBITDA between $4.6 billion to $4.9 billion due to improved market margins and growth in production. Recently, Evercore ISI lifted its price target on Cheniere Energy, Inc. (NYSE:LNG) to $130, while keeping an ‘Outperform’ rating on the shares.
As of Q2 2021, 49 hedge funds tracked by Insider Monkey have positions in Cheniere Energy, Inc. (NYSE:LNG), compared with 40 in the previous quarter. The total value of these stakes is over $2.94 billion.
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