Published Thu, 16 May 2019 00:12:51 -0400 on Seeking Alpha
Like many income investors, the goal of my retirement portfolio (where I keep 100% of my life savings) is to maximize safe and growing income, with no interest in yield traps (companies that are likely to have to cut their payouts).
This is why over my five years as an investment analysts/writer I've honed my analytical/risk models to focus on quality first and valuation (including yield) second.
Today all my retirement portfolio investments (and article recommendations) are based on my three-factor Sensei quality score, which looks at dividend safety, business model, and management quality. The 11 point scale classifies companies with 8 or higher scores as blue-chips, and 9 or higher as SWAN stocks (sleep well at night, a very high quality blue-chip).
I am only interested in buying level 8 or above quality dividend stocks (though at times I'll point out level 7 "dirty values" buys like Qualcomm was recently for more risk-tolerant investors because I consider the margin of safety high enough).
In this article, I wanted to highlight two deeply unpopular level 8 quality blue-chip MLPs, Energy Transfer LP (ET) and MPLX (MPLX), that the market is currently badly mispricing. That's based on their fundamentals, quality, and long-term growth outlook, which should allow them to deliver very generous, safe and growing income over time, in all economic, industry, and market environments.
Better yet, with ET and MPLX about 29% and 31% undervalued, respectively, both 8+%... Read more