The Contrarian Energy MLP: Vanguard Natural Resources, LLC (VNR), Chesapeake Energy Corporation (CHK), Range Resources Corp. (RRC)

What a Fool believes
Vanguard Natural Resources, LLC (NYSE:VNR) is a unique investment. Its contrarian approach may have seen absurd only a year ago, but it could work based on the prices it has paid for its assets. What also is very interesting about Vanguards approach is its preference to take non-operating stakes in certain plays. More than 40% of the company’s budget relies on other operators. The issue with these types of ventures is that the company has less control of the drilling schedule, but it helps to keep its operational budget lower so the company can dedicate more of its operational cash flow to its distributions. At a distribution yield of 8.8%, this MLP certainly needs a healthy cash flow.

The article The Contrarian Energy MLP originally appeared on Fool.com and is written by Tyler Crowe.

Fool contributor Tyler Crowe owns shares of Linn Energy, LLC. You can follow him at Fool.com under the handle TMFDirtyBird, on Google +, or on Twitter, @TylerCroweFool.The Motley Fool recommends Range Resources and has options on Chesapeake Energy.

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