Key Points

• Nucor is an out-of-favor steelmaking giant.

• High-yield Federal Realty is the only REIT that is a Dividend King.

• Enterprise Products Partners is a high-yield midstream bellwether with a great distribution record.

• 10 stocks we like better than Enterprise Products Partners ›

If you are looking to invest some money today and have a holding period that is 10 years or more, you're going to want to pick from an elite group of companies. You want industry-leading monsters that have something unique about them that will keep them ahead of the pack. Nucor (NYSE: NUE), Federal Realty Investment Trust (NYSE: FRT), and Enterprise Products Partners (NYSE: EPD) all fit the bill. Here's why.

1. Nucor is a giant U.S. steelmaker

Steel is a cyclical industry that is a bit out of favor today. That's left U.S. steelmaking giant Nucor's stock down about 30% from its 2023 highs. Don't let that deep downturn worry you, it is actually pretty normal for a steel company. In fact, the best time to buy a cyclical business can often be when Wall Street has placed it in the dog house.

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What sets Nucor apart from its peers is its status as a Dividend King. Despite the inherent swings in the industry, this company has managed to continue to increase its dividend through thick and thin. Helping that along is a boring and reliable playbook focusing on continually investing in the business. That has notably included both the production of bulk steel and the expansion of the portfolio into higher-margin steel products.

Some investors will buy Nucor to play the steel cycle. But this is the type of company that you might want to buy and sock away for 10 years or more. Although the dividend yield is a bit miserly at 1.7%, this stock is really about getting exposure to a reliable and growing steel business.

Image source: Getty Images.

2. Federal Realty is the only one of its kind

Sticking with the Dividend King theme, real estate investment trust (REIT) Federal Realty has also increased its dividend annually for more than five decades. It is the only REIT to have achieved that feat, making it an industry standout even though it is actually a fairly small business.

Don't let the company's modest portfolio of about 100 properties fool you. It happens to own some of the most desirable strip malls and mixed-use developments in the markets where it operates. It is the focus on quality over quantity that has resulted in Federal Realty's strong track record.

That said, the REIT is a very active portfolio manager. So it is always buying and selling assets, redeveloping new acquisitions to increase the value so they can be sold down the road at a premium price. Federal Realty won't excite you, but you can be sure that the attractive 4.6% dividend yield is backed by an incredibly reliable business.

3. Enterprise Products Partners is an industry leader

Enterprise Products Partners is one of the largest midstream businesses in North America. Its portfolio of pipelines, storage, processing, and transportation assets is vital to the world's energy markets. And it largely charges fees for the use of its assets, which makes the cash flows it generates highly reliable regardless of the price of the commodities moving through its system.

This is the big-picture story that supports the master limited partnership's (MLP's) huge 6.9% yield. The slow and steady growth the business has achieved over time, meanwhile, is what has supported Enterprise's streak of 26 consecutive annual distribution hikes. That's not enough to make it a Dividend King, like Nucor and Federal Realty, but Enterprise hasn't been around for 50 years, either. It has been around for a little over a quarter of a century, having gone public in 1998. Which means the distribution has been increased on the regular from day one.

Three monster options from three different sectors

Nucor, Federal Realty, and Enterprise are vastly different businesses, but each one is a monster in its own way. And each one has an incredible dividend track record. If you are looking for stocks to buy and hold, this trio would be a good place to start today.

Should you invest $1,000 in Enterprise Products Partners right now?

Before you buy stock in Enterprise Products Partners, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Enterprise Products Partners wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,063,471!*

Now, it’s worth noting Stock Advisor’s total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 21, 2025

Reuben Gregg Brewer has positions in Federal Realty Investment Trust and Nucor. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.

Key Points

• Enterprise Products Partners is boosting its distribution by another 1.9%, compared to last quarter.

• The MLP can easily afford to continue giving its investors raises.

• The midstream giant has lots of fuel to continue growing its payout in the coming years.

• 10 stocks we like better than Enterprise Products Partners ›

Enterprise Products Partners (NYSE: EPD) continues to be an income-generating machine for its investors. The master limited partnership (MLP) recently declared its latest distribution payment. It's paying $0.545 per unit ($2.18 annualized), up from $0.535 last quarter ($2.14 annualized).

This hike continues the steady upward trend in the distribution, which has increased for 26 consecutive years. At its recent unit price, the midstream giant's distribution yield is approaching 7%.

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The MLP should have plenty of fuel to continue increasing its payout in the coming years. That makes it an excellent option for those seeking to generate passive income, as long as they're comfortable receiving the Schedule K-1 Federal Tax Form that the MLP sends to investors each year.

Image source: Getty Images.

The raises keep coming

Enterprise Products Partners is hiking its distribution payment by 1.9%, compared to the first quarter, putting it 3.8% above the year-ago payment level. That continues its long history of distribution increases, which is now well into its 26th straight year.

The MLP can easily afford this higher distribution level. The pipeline company generated $2 billion in distributable cash flow during the first quarter, representing a 5% increase from the year-ago level. That was enough cash to cover its quarterly payment by a super comfy 1.7 times.

As a result, Enterprise Products Partners retained $842 million in excess free cash flow in the period. It returned an additional $60 million of that money to shareholders via unit repurchases and reinvested the rest into growing its operations.

Enterprise Products Partners' conservative payout ratio has enabled it to maintain a strong balance sheet. The MLP ended the first quarter with a low 3.1 times leverage ratio. This level supports the strongest balance sheet in the midstream industry, as Enterprise has A-rated credit (A-/A3).

Ample fuel to continue growing its payout

Enterprise Products Partners has grown its payout by expanding its integrated midstream network. It still has a lot of growth ahead.

The midstream company had $7.6 billion of major growth projects in its backlog at the end of the first quarter. The bulk of those projects ($6 billion) are on track to come online by the end of this year, including two more gas processing plants and some additional export capacity. The remaining projects (another gas processing plant and additional export capacity additions) should enter commercial service by the end of 2026.

As a result, the company's free cash flow is on track to surge. In addition to the increased cash flow from its new projects, the company's capital spending is on track to decline from a range of $4 billion-$4.5 billion this year to $2 billion-$2.5 billion in 2026.

The incremental free cash flow will provide Enterprise Products Partners with the flexibility to return more money to investors through distribution increases and unit repurchases. The MLP can also make additional growth investments (organic expansions and acquisitions).

The company has several more expansion projects under development, including additional gas processing capacity. Enterprise also has a long history of making accretive deals that enhance its growth and profitability.

For example, last year, it bought Pinon Midstream for $950 million. The company expected the deal to add $0.03 per unit to its distributable cash flow this year. Additionally, it came with built-in opportunities to expand Pinon's treating capacity, which would also enable Enterprise to expand its gas processing capacity.

A top choice for a steadily rising passive-income stream

Enterprise Products Partners pays a high-yielding distribution backed by a rock-solid financial profile. It has an exceptional record of increasing its payout, which should continue in the coming years. These factors make the MLP a compelling investment option for those seeking to generate stable and growing passive income.

Should you invest $1,000 in Enterprise Products Partners right now?

Before you buy stock in Enterprise Products Partners, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Enterprise Products Partners wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $694,758!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $998,376!*

Now, it’s worth noting Stock Advisor’s total average return is 1,058% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 7, 2025

Matt DiLallo has positions in Enterprise Products Partners. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.

Key Points

• Ares Capital has delivered a long-term cumulative return that trounced the S&P 500.

• Enterprise Products Partners is resilient and has better long-term prospects than many might think.

• Verizon Communications has staying power and should be a key player in 6G wireless networks in the future.

True or false: The higher the dividend yield, the more worried you should be.

This is a tricky question, if not a trick question. With some stocks, a high dividend yield can be a cause for alarm. With other stocks, though, a high yield isn't concerning whatsoever.

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I own quite a few stocks with dividend yields of over 5%. I wouldn't necessarily commit to owning all of them over the next 20 years. However, here are three ultra-high-yield dividend stocks I don't plan on ever selling.

Image source: Getty Images.

1. Ares Capital

Ares Capital (NASDAQ: ARCC) is the largest publicly traded business development company (BDC). The company has invested more than $17 billion since its inception in 2004. The BDC focuses on middle-market companies with annual revenue between $10 million and $1 billion.

I really like Ares Capital's dividend, with its forward yield of 8.63%. Even better, the company has either maintained or grown its dividend for 63 consecutive quarters -- a streak that I'm confident will continue.

But I probably wouldn't plan on never selling this stock if all that it had going for it was its juicy dividend. A key factor behind my intention to own Ares Capital over the long run is its position in a growing market. There has been a clear shift in recent years to private capital. Ares Capital targets a total addressable market of around $5.4 trillion. I think it's easily the best BDC around, with its diversified portfolio, strong industry relationships, and rock-solid risk management.

I'm also impressed by Ares Capital's performance. Since its initial public offering (IPO), it has delivered a cumulative total return that's 80% higher than the S&P 500. Maybe the stock won't be able to continue beating the market so handily going forward, but I wouldn't bet against it.

2. Enterprise Products Partners

Enterprise Products Partners (NYSE: EPD) is a master limited partnership (MLP) that is a leader in the North American midstream energy industry. It operates more than 50,000 miles of pipeline in addition to numerous other assets.

Many MLPs pay highly attractive distributions. Enterprise Products Partners is no exception, with its forward distribution yield of 6.81%. Even better, the company has increased its distribution for 26 consecutive years.

Am I crazy to believe that I can own a stock that's dependent on fossil fuels for years to come? I don't think so. Sure, renewable energy sources will almost certainly be more widely used in the future. However, the demand for oil and gas (especially natural gas and natural gas liquids) should continue to grow for decades to come. That means the demand should remain strong for Enterprise Products Partners' pipelines.

This MLP has already proved its resilience. Enterprise Products Partners delivered steady cash flow per unit during every major crisis affecting the oil and gas industry over the last two decades.

3. Verizon Communications

While you might not have heard of Ares Capital or Enterprise Products Partners, odds are that you're quite familiar with Verizon Communications (NYSE: VZ). The telecommunications giant serves millions of customers worldwide.

Many income investors will especially like Verizon. Its forward dividend yield is a lofty 6.22%. The company has also increased its dividend for 18 consecutive years.

I've tried to picture a world where wireless services from companies like Verizon aren't needed, but my imagination just isn't that good. I also seriously doubt any new competition will arise in this market, considering the massive amount of capital required to build out wireless networks. The bottom line is that I believe Verizon has staying power.

Will Verizon be a huge growth machine? Probably not. However, 6G is on the way -- probably by the end of the decade. This new higher-speed wireless protocol could hold the potential for holographic communication, immersive extended reality (think augmented reality and virtual reality at a whole new level), and more. I fully expect Verizon will be a major player in 6G and could deliver more impressive growth in the future.

Should you invest $1,000 in Ares Capital right now?

Before you buy stock in Ares Capital, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Ares Capital wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Keith Speights has positions in Ares Capital, Enterprise Products Partners, and Verizon Communications. The Motley Fool recommends Enterprise Products Partners and Verizon Communications. The Motley Fool has a disclosure policy.

Oil and natural gas prices can move in unexpected ways and do so in a dramatic and rapid fashion. The geopolitical conflicts playing out today are yet another evidence point that energy investors need to be prepared to deal with often headline-grabbing and perhaps shocking volatility.

If you are looking for a high-yield energy stock today, you'll be better off sticking with a reliable giant like Chevron (NYSE: CVX) or attempting to sidestep energy prices with an investment in a midstream giant like Enterprise Products Partners (NYSE: EPD). Here's what you need to know.

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1. Chevron gives you direct exposure to energy

If what you are really looking for is some exposure to oil and natural gas, then Chevron and its roughly 4.7% dividend yield could be for you. A $1,000 investment will net you around six or seven shares today. The big story here, however, is the impressive history of dividend growth, with dividend increases in each of the last 38 years.

Image source: Getty Images.

Oil and natural gas prices have gone through many dramatic swings over that span, and still, Chevron has remained committed to supporting its dividend. It is built to survive such energy market swings. For starters, its business is diversified across the energy sector and geographically. Having exposure to the upstream (energy production), the midstream (pipelines), and the downstream (chemicals and refining) helps to soften the peaks and valleys since each segment operates a little differently through the energy cycle. Having exposure to various global energy markets on the supply and demand side allows Chevron to focus its investments in the areas with the highest returns.

Then there's the energy giant's balance sheet, which is rock solid. With a debt-to-equity ratio of around 0.2x, it has notably less leverage than most of its closest peers. This gives management the leeway to take on debt during industry weak spots so it can continue to support its business and dividend. When oil prices recover, as they always have historically, Chevron simply reduces its leverage to prepare for the next industry downturn.

Playing it as safe as possible with high-yield Chevron is a good call for dividend investors that want more direct oil exposure.

2. Enterprise Products Partners shifts the energy playbook

But you don't have to have direct exposure to oil prices if you want to invest in dividend-paying energy stocks. That's because the midstream segment is the one part of the energy industry that works a little differently. Businesses like Enterprise Products Partners own the energy infrastructure, like pipelines, that move oil, natural gas, and the products into which they get turned around the world.

What sets the midstream apart from the upstream and the downstream is that the midstream largely charges fees for the use of energy infrastructure assets. In other words, businesses like Enterprise Products Partners are just toll-takers. The volume of products moving through its portfolio of assets is more important than the price of those products. And since energy is so vital to modern life, demand for energy tends to be high regardless of the price of oil. The reliable cash flow Enterprise generates is what supports the master limited partnership's (MLP's) lofty 6.8% distribution yield.

A $1,000 investment in Enterprise will leave you owning around 31 shares of the MLP. But, like Chevron, a key part of the story here is the distribution history. Enterprise has increased its disbursement every year for 26 consecutive years. And, like Chevron, Enterprise is financially strong (it has an investment-grade-rated balance sheet) and conservatively run. The distribution yield will make up the vast majority of your total return here, but if you are trying to maximize the income your portfolio generates, that probably won't bother you.

Two solid energy options for volatile times

Given the current volatility in the energy sector, Chevron and Enterprise are good options for investors right now. But they are usually good options in the energy sector because they are built to deal with the industry's volatility while rewarding investors for sticking around with dividends. If you have $1,000 and you want to add an energy stock, one of these two will be a good dividend-focused pick for your portfolio.

Should you invest $1,000 in Chevron right now?

Before you buy stock in Chevron, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Chevron wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $713,547!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $966,931!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 177% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chevron. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.

One of the best ways to ensure an investment can reward you well for the rest of your life is to buy reliable, high-yield stocks. On that front, Enterprise Products Partners (NYSE: EPD) stands out. A well-above-market distribution yield of 6.8% is one reason for that, but so is the strength of the midstream master limited partnership's (MLP's) business and its impressive distribution history. Here's what you need to know before buying.

What does Enterprise Products Partners do?

Enterprise Products Partners owns energy infrastructure, including pipelines, storage, processing, and transportation assets. It operates in what is generally referred to as the "midstream" segment of the overall energy sector. This is very important if you are looking to set yourself up with a reliable income stream for the rest of your life.

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Image source: Getty Images.

The "upstream" is where oil and natural gas are produced. The "downstream" is where these commodities are processed. Financial results in both the upstream and the downstream are heavily influenced by often volatile commodity prices. The midstream, which basically connects the upstream to the downstream (and the rest of the world), isn't. Midstream businesses generally charge fees for the use of their energy assets. So, demand for energy, which tends to be fairly robust through the economic cycle, is more important to financial results.

Basically, Enterprise Products Partners' core business is designed to produce reliable cash flows. And those cash flows support the MLP's lofty 6.8% distribution yield. That yield is likely to make up the lion's share of an investor's return over time, but that probably won't be a problem for income-oriented investors.

How reliable is Enterprise Products Partners?

Enterprise Products Partners' business is designed to generate reliable cash flows, but what does history say about its ability to set you up with a lifetime of reliable distributions? Well, a lot.

For starters, Enterprise has increased its distribution annually for 26 consecutive years. That notably includes increases during the coronavirus pandemic and the oil downturn in 2016, both times when it would have been easy to justify a distribution cut. In fact, peers did cut their distributions in both of those periods, including Energy Transfer (NYSE: ET) in 2020 and Kinder Morgan (NYSE: KMI) in 2016.

EPD Dividend data by YCharts

If you are looking for a reliable income investment, Enterprise Products Partners stands out. But there's more to like here than just the distribution streak. For example, Enterprise Products Partners has an investment-grade-rated balance sheet. The distribution is covered 1.7x by the MLP's distributable cash flow. Essentially, there is a lot of room for adversity before a distribution cut would likely be on the table.

The distribution seems highly likely to keep growing, as well. The first reason is inherent to the midstream business. Increasing the fees charged along with inflation is the industry norm. Meanwhile, Enterprise has a long history of growing through capital investment projects, with a $7.6 billion capital plan currently in the works. On top of those two growth levers, Enterprise happens to be large enough to act as an industry consolidator. So, the occasional acquisition is a further growth driver to keep in mind, though acquisitions are impossible to predict.

Enterprise offers a compelling story for income investors

The one caveat here is that the world is increasingly using cleaner energy sources. However, the transition is likely to take decades, and it is far more likely that an all-of-the-above strategy (that includes carbon fuels) will be the final outcome. Don't count Enterprise out because it deals with carbon energy. All in, if you are looking for an investment that can set you up with a lifetime of income, Enterprise Products Partners and its lofty 6.8% distribution yield should be on your shortlist today.

Should you invest $1,000 in Enterprise Products Partners right now?

Before you buy stock in Enterprise Products Partners, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Enterprise Products Partners wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $676,023!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,692!*

Now, it’s worth noting Stock Advisor’s total average return is 793% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Kinder Morgan. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.

Investors don't need a fortune to begin generating steady income. Many great dividend stocks are available at relatively low prices.

What are the smartest dividend stocks to buy right now if you only have $150 to invest? I can think of lots of good ones, but here are my three top picks.

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1. Dominion Energy

It isn't surprising to me in the least that many utility stocks have held up well during this year's market turbulence. You can buy one share of my favorite utility stock, Dominion Energy (NYSE: D), for around $56. And you'll get a big bang for your buck.

Dominion provides electricity service to 3.6 million homes and businesses in its home state of Virginia, as well as in North Carolina and South Carolina. It also provides natural gas service to roughly half a million customers in South Carolina. In addition, Dominion owns offshore wind and solar power facilities.

The company offers a forward dividend yield of 4.76%. Although Dominion cut its dividend in 2020, management appears firmly committed to at least funding the dividend at current levels going forward.

I don't just like Dominion for its dividend, though. The utility company expects to grow its earnings per share by 5% to 7% on average each year. Data centers are a key component of Dominion's growth strategy, particularly given that Virginia ranks as the largest data center market in the world.

2. Enterprise Products Partners

Technically, you can't buy a share of Enterprise Products Partners (NYSE: EPD). That's because it's a limited partnership (LP). Instead of shares, Enterprise has units. But one unit will only cost you roughly $31.

Enterprise Products Partners is a leader in the North American midstream energy market. It owns more than 50,000 miles of pipelines that transport natural gas liquids (NGLs), natural gas, and crude oil. Enterprise can also store over 300 million barrels of NGLs, crude oil, petrochemicals, and refined products, plus 14 billion cubic feet of natural gas.

I suspect many income investors will love this LP's forward distribution yield of 6.94%. Enterprise Products Partners also boasts an impressive 26-year streak of distribution increases.

Another big reason to like Enterprise Products Partners is its stability. The midstream leader has a strong balance sheet. Its business is largely recession-resistant and protected against rising inflation. As a result, Enterprise has been able to generate steady cash flow year in and year out, even during crises such as the Great Recession and the COVID-19 pandemic.

Image source: Getty Images.

3. Realty Income

After buying one share of Dominion Energy and one unit of Enterprise Products Partners, you'd have around $63 left from an initial $150. That's more than enough to scoop up a share of Realty Income (NYSE: O), which currently trades around $56 per share.

Realty Income ranks as the world's seventh-largest real estate investment trust (REIT). It owns 15,627 properties in eight countries. The REIT's tenants include some of the top companies, including 7-Eleven, Dollar General, and Walmart, and its client base is diversified, representing 91 industries.

REITs must return at least 90% of their earnings to shareholders as dividends to be exempt from federal income taxes. Unsurprisingly, Realty Income pays a juicy dividend. Its forward dividend yield currently stands at 5.76%. The company has also increased its dividend for 30 consecutive years. And there's even more good news: Realty Income pays its dividends monthly rather than quarterly. The REIT recently announced its 659th consecutive monthly dividend.

What about growth? Realty Income checks that box, too. It has delivered 29 straight years of positive total operational returns. The total net lease addressable market in the U.S. is around $5.5 trillion. The addressable market in Europe is even bigger -- $8.5 trillion. Realty Income also faces only two major rivals that target the European market.

Should you invest $1,000 in Realty Income right now?

Before you buy stock in Realty Income, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Realty Income wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 171% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Keith Speights has positions in Dominion Energy, Enterprise Products Partners, and Realty Income. The Motley Fool has positions in and recommends Realty Income and Walmart. The Motley Fool recommends Dominion Energy and Enterprise Products Partners. The Motley Fool has a disclosure policy.

Enterprise Products Partners (NYSE: EPD) has been an elite income-producing investment over the years. The master limited partnership (MLP) has raised its cash distribution to investors for 26 straight years (every year since its initial public offering). The energy midstream giant currently offers a yield of around 7%, which is several times higher than the S&P 500 (less than 1.5%).

One factor fueling the MLP's lucrative and steadily growing payout is its leading energy export business. It operates several marine terminals along the U.S. Gulf Coast that export natural gas liquids, crude oil, petrochemicals, and refined products to global markets.

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China is a major destination for its ethane and butane exports. That's a potential problem now that the U.S. Department of Commerce is requiring companies to apply for a license to export to China. Here's a look at whether this policy shift could affect the company's ability to continue growing its high-yielding payout.

Image source: Getty Images.

Stopping the flow of ethane to China

The Commerce Department recently ordered companies to stop shipping goods, including ethane and butane, to China without a license. That will have a direct effect on Enterprise Products Partners.

The company's marine terminal on the Houston ship channel loaded about 85,000 barrels of ethane per day last year for export to Chinese markets. That represented about 40% of the volumes from that facility, a big chunk of this country's ethane exports to China, which hit a record 227,000 barrels per day last year. The U.S. also exported a record 26,000 barrels of butane per day in 2024.

The company is currently evaluating its procedures and internal controls. It said in a regulatory filing that it's not yet sure if it will be able to obtain a license to resume exports to China.

One potential roadblock to a license is that an agency of the Commerce Department told the company that ethane and butane exports to China pose an unacceptable risk of military end-use by the country.

However, that's not the typical use of ethane. Chinese petrochemical companies use the cheaper natural-gas-based product in place of oil-based naphtha as a feedstock to produce plastics and chemicals. It also has heating and cooking uses.

An uncertain near-term impact

Enterprise isn't sure how much this policy change will affect its operations and cash flow. A big unknown is whether the industry will be able to quickly find alternative markets and uses for the U.S. ethane and butane that were flowing to China. It's also not clear how much effect this will have on prices.

China is a major energy consumer, making it a prime destination for U.S. hydrocarbons. U.S. exports satisfy 27% of the country's demand. While the Trump administration is currently curtailing exports to China, increasing U.S. energy export volumes to the country could help reduce the current trade imbalance.

Enterprise's co-CEO Jim Teague said on the company's first-quarter conference call last month that the new administration's tariff plan "is causing nothing short of chaos around the world. Energy is not excluded." However, his company believes that the administration's policies have an end goal, which is "intended to promote U.S. energy, not just for the next four years, but for decades," Teague added. That's because U.S. energy is important to our economy, global markets, and our balance of trade.

Built to withstand the uncertainty

The new license requirements to export ethane to China could have some effect on Enterprise Products Partners' export business. However, the company has one of the most diversified midstream operations in the industry, which should help mute the impact.

On top of that, it has one of the strongest financial profiles in the energy midstream sector. Because of that, the headwind shouldn't significantly affect the MLP's ability to continue paying a growing distribution in the near term.

Meanwhile, the administration's policies should be net positives for the U.S. energy sector over the long term, especially for exports, since they're crucial to helping balance trade. Given all the positives, the company remains a rock-solid option for income-seeking investors to buy and hold for the long haul.

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Matt DiLallo has positions in Enterprise Products Partners. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.

The energy midstream sector has been a great spot for investors to go if they want to make some passive income. Many companies in this sector produce very stable cash flow as oil and gas flow through their pipelines and related midstream assets. That gives them money to pay lucrative dividends and invest in growing their businesses.

Enbridge (NYSE: ENB), Enterprise Products Partners (NYSE: EPD), and Kinder Morgan (NYSE: KMI) are among the top options, according to a few Fool.com contributors, for those seeking passive income in the sector. Here's why this trio of midstream companies could help you create years of passive income.

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Enbridge: A high yielder that's built to last

Reuben Gregg Brewer (Enbridge): The midstream sector is tied at the hip to oil and natural gas producers. But not every pipeline company is the same, and one notable standout is Enbridge. A key corporate goal is to provide the world with the energy it needs. Today, only around 75% of Enbridge's earnings before interest, taxes, depreciation, and amortization (EBITDA) are linked to oil and natural gas pipelines.

That 75% is a solid core, to be sure, given that Enbridge is one of the largest midstream players in North America. And this foundation has handily supported regular dividend increases, with the annual streak now up to three decades. But long-term dividend investors need to pay particular attention to the other 25% of EBITDA.

The rest of the portfolio is split between regulated natural gas utilities and renewable power investments. Both of these businesses provide reliable cash flows, just like pipelines. However, the utility business tends to provide more consistent opportunities for capital investments, while clean energy investment is expected to grow materially in the years ahead. And both natural gas utilities and renewable power are moving Enbridge in the same "cleaner power" direction as the rest of the world. In other words, Enbridge is preparing today for the energy market of tomorrow.

With a huge 5.8% yield, 30 annual dividend increases, and a business that is changing with the energy needs of the world, Enbridge is the kind of dividend stock you buy and hold for the long term.

These dividends should keep growing

Neha Chamaria (Enterprise Products Partners): Enterprise Products Partners is one of the largest midstream energy companies in the U.S., with a massive pipeline network spanning over 50,000 miles. While its large footprint provides critical energy transportation services to the economy, Enterprise Products has judiciously used capital over the decades to grow its business and reward shareholders while maintaining a strong balance sheet.

Enterprise Products has increased its dividend for 26 consecutive years, and its distributable cash flows (DCF) have covered its dividend payout by at least 1.5 times since 2018. Similar to cash flows from operations, DCF is an important metric for master limited partnerships like Enterprise Products, as they are required to distribute a major portion of their income to shareholders in the form of dividends.

This is a great time to invest in Enterprise Products stock. The midstream giant expects major projects worth $6 billion to come online this year. That's nearly 80% of all major projects under construction. As these projects start contributing to the company's earnings and cash flows, Enterprise Products should be in an even stronger position to not only pay regular dividends but also increase them year after year. With the stock also yielding a hefty 6.8%, Enterprise Products is one of the best midstream stocks to buy to earn years of passive income.

A growing pipeline of projects

Matt DiLallo (Kinder Morgan): Kinder Morgan currently clocks in with a dividend yield approaching 4.5%. That high-yielding payout is on a very sustainable foundation. The natural gas pipeline giant generates very stable cash flow, as 95% comes from highly contracted and predictable sources, like long-term fee-based contracts. Meanwhile, the company pays out less than 45% of its stable cash flows in dividends. That enables it to retain significant excess free cash flow to invest in expanding its operations.

The company has $8.8 billion of growth capital projects in its backlog, primarily natural gas pipeline expansions ($8 billion). It currently has projects underway that it expects will enter commercial service by the end of the decade. That gives it a lot of visibility into its ability to grow its cash flow in the coming years.

Kinder Morgan's backlog has ballooned by more than $5 billion over the past year as it has secured several large-scale natural gas expansion projects. Demand for gas is surging these days, fueled by catalysts like AI data centers, the onshoring of manufacturing, and the electrification of transportation. These drivers should enable Kinder Morgan to continue securing additional expansion projects in the coming years.

The pipeline giant's cash flow should grow briskly over the next several years as its growing backlog of expansion projects enters commercial service. That should enable Kinder Morgan to continue increasing its dividend. The company recently raised its payment for the eighth straight year. Given its high yield and growth visibility, Kinder Morgan can certainly create years of passive income for investors.

Should you invest $1,000 in Enbridge right now?

Before you buy stock in Enbridge, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Enbridge wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

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See the 10 stocks »

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Matt DiLallo has positions in Enbridge, Enterprise Products Partners, and Kinder Morgan. The Motley Fool has positions in and recommends Enbridge and Kinder Morgan. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.

In an era of economic uncertainty and market volatility, the quest for reliable income has become increasingly important for investors. While growth stocks may capture headlines, dividend-paying companies form the backbone of many successful retirement portfolios. The appeal is straightforward: regular cash payments that arrive regardless of market conditions, providing a dependable income stream when it's needed most.

High-yield dividend stocks are particularly attractive in the current environment. With inflation gradually cooling but still a concern, and interest rates potentially trending lower in the coming years, companies that consistently distribute significant portions of their earnings to shareholders offer both immediate income and a hedge against future economic challenges.

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Image source: Getty Images.

For income-focused investors, two energy companies stand out for their combination of substantial yields, reasonable payout sustainability, and established business models. Enterprise Products Partners (NYSE: EPD) and Duke Energy (NYSE: DUK) share a commitment to rewarding shareholders through consistent, above-average dividend payments. Here's a rundown of each company's core investing thesis and key dividend metrics.

Energy infrastructure with a generous payout

Enterprise Products Partners L.P. is a leading North American midstream energy provider, operating approximately 50,000 miles of pipelines alongside extensive storage and processing facilities. The company's business model generates steady, fee-based income from long-term contracts with minimum volume commitments, largely insulating it from commodity price swings.

With a substantial 6.9% distribution yield and over a quarter-century of consecutive annual increases to its payout, Enterprise Products Partners offers both substantial current income and a healthy amount of growth potential for income investors, driven primarily by its expanding capital investment program and strategic positioning in natural gas liquids export markets.

Equally as important, the company's fairly conservative 58.1% payout ratio and strong balance sheet (3.1x leverage ratio) imply that its distributions ought to be safe, even in this volatile market. Keeping with this theme, the midstream energy giant's recent financial results showed healthy growth, with distributable cash flow up 6% year over year to $2.2 billion.

On the value front, Enterprise Products Partners' forward price-to-earnings ratio (P/E) of approximately 10.1 represents a significant discount to the benchmark S&P 500 (SNPINDEX: ^GSPC), which trades at 19.4 times forward earnings. As a result, the company's equity offers an attractive valuation alongside its generous income stream.

What's the bottom line? Enterprise Products Partners represents a rare combination of high current yield, consistent distribution growth, and a compelling valuation. This midstream giant thus deserves serious consideration as a cornerstone holding in a dividend-focused portfolio. After all, Enterprise's critical infrastructure and increasing focus on natural gas (a transition fuel) should keep its cash flow and distributions flowing for years to come, even as the energy transition from fossil fuels to renewables evolves in the years ahead.

Powering portfolios with regulated stability

Duke Energy is one of the nation's largest utilities, delivering essential electricity and natural gas services to approximately 8.4 million electric customers and 1.7 million natural gas customers. This regulated business structure creates a solid foundation for predictable revenue and cash flow that remain relatively stable, even during economic downturns.

For income-focused investors, Duke presents a compelling opportunity with its current 3.37% dividend yield -- more than double the S&P 500's current yield of around 1.3%. While not as high as some other utilities, Duke compensates with exceptional dividend consistency, having paid dividends for 99 consecutive years and increased them annually for the past 18 years. This century-approaching dividend streak demonstrates management's unwavering commitment to shareholder returns.

Still, the company's 73% payout ratio is higher than many other blue chip dividend payers. That said, Duke's elevated payout ratio shouldn't be a major concern, given the company's steady cash flow and built-in regulatory protections.

From a valuation perspective, Duke stock trades at a forward P/E of 18.5, slightly below the S&P 500's 19.4 multiple. This relatively fair valuation is notable considering Duke's above-average growth prospects in the utility sector, supported by a 1.5% to 2% annual electricity demand growth that's expected to accelerate to 3% to 4% by 2027, thanks to rising energy demand from data centers.

The investment case in a nutshell? Duke Energy combines defensive utility characteristics with above-average growth potential in an increasingly electrified economy. While not the highest-yielding option, Duke offers a rare blend of dividend safety, growth visibility, and a reasonable valuation that makes it worthy of consideration in this challenging market.

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George Budwell has positions in Duke Energy. The Motley Fool recommends Duke Energy and Enterprise Products Partners. The Motley Fool has a disclosure policy.