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Buckeye Partners: Why I'm Avoiding This 14.4% Yielding MLP

Published Fri, 19 Oct 2018 08:06:51 -0400 on Seeking Alpha

This article was originally posted to my private investing service, Energy Profits in Dividends, on September 16, 2018. It is being posted here as a sample of what subscribers can expect from the service and has been edited to account for the fact that the unit price has declined significantly since my original posting.
Buckeye Partners, L.P. (BPL) is one of the largest petroleum pipeline operators in the United States, with operations in the Northeast, Southeast, and Midwestern portions of the United States. The company is also one of the few master limited partnerships with operations outside of the nation as it owns and operates marine terminals in the Caribbean, Europe, the Middle East, and Southeast Asia. This is a company that has certainly generated a significant amount of controversy at Seeking Alpha, with some analysts highly recommending it and others expressing some concerns. I would count myself in the latter camp as, while the company does certainly have some appealing qualities, there are a few concerning items about it.
About Buckeye Partners As just mentioned, Buckeye Partners is one of the larger U.S. partnerships in the midstream space. As of the time of writing, the units trade for $35.06, which gives the company a market capitalization of approximately $5.37 billion. This unit price also gives the company a very impressive 14.40% distribution yield. However, this distribution yield is at least partly due to the company’s poor price performance over... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
SUMMIT MIDSTREAM PARTNERS LP 7.31   0.0 -0.34 1.15 15.11
KINDER MORGAN 20.42   20.6 0.99 1.00 4.78
AMERICAN MIDSTREAM PARTNERS LP 5.24   0.0 -0.88 0.21 3.94


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