High-yield dividend stocks generally have a higher risk profile. The yield is close to 8%, Doplex (NYSE:MPLX) Appears to be in a higher risk category. However, this is far from the truth.
this master limited partnership (MLP)—the entity that sends Schedule K-1 federal tax forms each year—has fortress-like financials. Additionally, the pipeline company has significant growth through 2029. These features mean you can buy it with confidence and hold it High Yield Dividend Stocks At least until the end of the century.
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MPLX recently reported fourth quarter and full-year financial results. The MLP generated $5.8 billion in distributable cash flow last year, enough to cover its high-yield distribution 1.4 times. The MLP generated $1 billion in free cash flow after paying distributions, allowing it to preserve cash to fund growth.
The pipeline company’s investment far exceeds last year’s amount, with growth investments totaling $5.5 billion. The company has made several acquisitions, including its $2.4 billion acquisition of Northwind Midstream. MLP has also invested in several expansion projects.
Despite such massive growth investments, MLP ended the year in a rock-solid financial position. Its leverage of 3.7x is well below the 4.0x range its stable cash flow can support. The MLP’s strong financial position and growing cash flow allowed it to increase its distribution payments by 12.5% last year.
MPLX expects to invest an additional $2.4 billion in growth capital projects this year. MLPs are on a long list of expansions. It is building two new LNG fractionators near its parent company (Marathon Oil Company) The Galveston Bay refinery is expected to be completed in 2028 and 2029. The company also has strategic partnerships with companies to build Gulf Coast LPG export terminals Onek The pipeline will come online in 2028. In addition, it has invested in several joint ventures to build new natural gas pipelines, which should be commissioned between 2026 and 2029.
MLPs continue to pursue new growth capital projects. The construction of the Secretariat Gas Processing Plant No. 2 (expected to be commissioned in the second half of 2028) and the Marcellus Gathering System Expansion Project (expected to be commissioned in the first half of 2028) were recently approved. These projects further enhance its growth visibility in the coming years.
