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Buy, Sell, or Hold: Energy Transfer Partners

In this edition, energy editor Joel South discusses a number of master limited partnerships (MLPs) and lists Energy Transfer Partners as a solid investment, especially in today’s low-interest-rate environment. The company sports a healthy 8.4% distribution, backed up with a relatively safe fixed fee natural gas transportation business. Check out the following video for more information on Energy Transfer Partners as well as some other possibly buys in the MLP space.

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Austin Smith, Joel South, and The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Kinder Morgan. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.

Read/Post Comments (3) | Recommend This Article (3)

Comments from our Foolish Readers

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 September 04, 2012, at 6:35 PM, neamakri wrote:

    Look, I just don't get it. How can an entity pay out 300% of their earnings for five years. Would a Fool please explain?

  • Report this Comment On September 05, 2012, at 10:22 AM, Rokiez wrote:

    I sold all the ETP I had. Just don't like the management. There's much better managed MLP's out there... KMP, EPD for example.

  • Report this Comment On September 05, 2012, at 5:23 PM, TMFTheWhisperer wrote:

    @ Neamakri,

    When you are dealing with MLP’s, you need to focus on payout ratios based on distributable cash flow, not from earnings. MLP’s have unique business models with exuberant amounts of capital expenditures so to understand the sustainability of their dividends you need to look at cash flows, in this case specifically cash generated from operations. For ETP it was $1.35 billion vs. $669 million in profit. So in ETP’s case, the payout ratio from available cash is actually significantly under the 100% mark.

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