3 Stocks Offering Yields Higher Than 9%
It is difficult to ignore the lure of high yields. And that's precisely the reason why many investors fall for it, despite the risks involved. That doesn't mean that high-yield stocks should be completely avoided. However, it's important to know the risks involved and make an informed decision.
Three stocks -- Energy Transfer Partners (NYSE: ET), MPLX (NYSE: MPLX), and Targa Resources (NYSE: TRGP) -- are trading at yields higher than 9%. Though all three are midstream energy stocks, two are MLPs while one is a regular C corporation. Energy Transfer and MPLX are also much bigger in terms of market capitalization compared to Targa Resources.
Looking solely at Energy Transfer's operational performance, it's difficult to figure out why the stock trades at such a high yield and cheap valuation. It has growing cash flows and a strong cover for its distributions. Energy Transfer's solid operational performance and growth projects are enough to let it continue its massive distribution payouts in the future.
Source Fool.com
