ConocoPhillips (COP): This Stock is Great for Your IRA

Compelling dividend
Not only does ConocoPhillips offer steady growth, but the company pays a very generous dividend on its stock that’s currently just below 4.4%. For perspective, it’s a lot higher than Chevron Corporation (NYSE:CVX)‘s 3% dividend. While Chevron Corporation (NYSE:CVX) is in the midst of a major production growth phase, both companies are likely to grow projection by 5%. That means, all things being equal, ConocoPhillips (NYSE:COP) has the potential to outperform thanks to that higher dividend.

What’s interesting about that dividend rate is that it isn’t that much below the rate you can get in a master limited partnership these days. Believe it or not, its right in line with Enterprise Products Partners L.P. (NYSE:EPD), even after the company raised its distribution this week. Enterprise’s revenue is less tied to commodity volatility, but that works both ways, as higher natural gas prices could boost the value of ConocoPhillips stock even more in the future.

Final thoughts
With a solid plan to grow production and margins, ConocoPhillips (NYSE:COP) should deliver outstanding results over the next few years. Add in a very generous dividend and you can see why it’s personal favorite of mine.

The article ConocoPhillips Is a Great Stock for Your IRA originally appeared on Fool.com and is written by Matt DiLallo.

Motley Fool contributor Matt DiLallo owns shares of Phillips 66, Enterprise Products Partners L.P., and ConocoPhillips. The Motley Fool recommends Chevron and Enterprise Products Partners L.P.

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