The 15 Most-Watched MLPs

People watch stocks for different reasons -- they're waiting for a dip in price, watching for a specific catalyst, gathering all the news and information that might affect stocks they already own, or considering a sell. Regardless of their motivation, we can better understand market sentiment by seeing who's watching what. With the Fool's free My Watchlist service, we have tens of thousands of people telling us the businesses that have, for whatever reason, piqued their interest.

One particular area that has garnered interest over the years is Master Limited Partnerships. Investors are drawn to MLPs for their high yields and tax deferment. MLPs don't pay taxes at the corporate level, so the tax burden then gets passed to the investor. Without getting into too much detail, because of structure of the partnerships and the distributions, investors are entitled to a serious tax deferral. Investors should fully understand what they are in for before buying MLPs, but for those willing to do the research it can be very profitable.

The most-watched MLP is ...
Looking at the aggregate data, we see that Kinder Morgan Energy Partners LP (NYSE: KMP  ) is above the rest in terms of watch interest, the percentage of people keeping an eye on MLPs in general who are specifically watching each company. And for good reason.

Fool analyst Chuck Saletta picked Kinder Morgan Energy Partners as his top stock for a long-term-focused portfolio. He wrote:

If you're looking for a company you can buy, hold, and perhaps never need to sell, you'll want one with a strong economic moat, to assure it has long-term staying power. You'll also want one that pays its owners well. After all, the only ways to make money off a stock are through dividends or through selling, and if you're selling, the stock is hardly a core investment.

Kinder Morgan Energy Partners is one of the few companies that hit both criteria. With an impressive (and covered by operating cash flows) [6.4%] yield, its distribution currently beats highly rated bonds. And since what it does is about the closest you can get to a "tollbooth" operation, it's more or less in the business of digging its own moats. Those two factors make it an extremely attractive long-term holding.

Here are the rest of the top 15 most-watched companies in the industry with their watch interest along with the stocks' CAPS rating to show the sentiment of our investing community.

 

Company

Market Cap (millions)

CAPS Rating
(out of 5)

Watch Interest

1

Kinder Morgan Energy Partners LP

$22,926

6.4%

16.2%

2

Enterprise Products Partners LP (NYSE: EPD  )

$35,561

5.8%

11.6%

3

Linn Energy (Nasdaq: LINE  )

$6,870

6.8%

8.3%

4

Atlas Pipeline Partners LP (NYSE: APL  )

$1,800

4.4%

6.2%

5

Energy Transfer Partners LP (NYSE: ETP  )

$10,291

6.8%

4.9%

6

Magellan Midstream Partners LP

$6,597

5.3%

4.0%

7

ONEOK Partners LP

$8,299

5.7%

2.8%

8

Copano Energy LLC (Nasdaq: CPNO  )

$2,245

6.9%

2.5%

9

Terra Nitrogen Company LP (NYSE: TNH  )

$2,048

5.1%

2.1%

10

Cheniere Energy Partners LP

$2,984

9.4%

1.9%

11

Penn Virginia Resource Partners

$1,458

6.7%

1.9%

12

Alliance Resource Partners LP

$3,045

4.3%

1.8%

13

Inergy LP

$4,321

7.3%

1.8%

14

Enbridge Energy Partners LP

$8,074

6.6%

1.8%

15

Plains All American Pipeline LP

$9,246

6.2%

1.8%

Source: Motley Fool; Capital IQ, a division of Standard & Poor's.

Whether you're keeping an eye on industry stalwarts like Kinder Morgan Energy Partners LP or are watching an up-and-comer like Atlas Pipeline Partners LP, it pays to watch. We can help you keep tabs on your companies with My Watchlist, our free, personalized stock tracking service. Click here to start now.

Dan Dzombak's musings and articles he finds interesting can be found on his Twitter account: @DanDzombak.

Alliance Resource Partners LP, Enterprise Products Partners LP, Magellan Midstream Partners LP, and ONEOK Partners are Motley Fool Income Investor picks. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 11, 2011, at 6:12 PM, drborst wrote:

    Uh, The CAPS rating looks more like the yield. (though I find that number more interesting anyway).

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