Investing in dividend-paying stocks is one of the best ways to grow your wealth. Not only do they typically outperform non-payers over the long term, but the income they throw off can be reinvested, helping compound your returns. And while there are hundreds of these income machines out there, four that stand out now for yields that are well above average are Crestwood Equity Partners (NYSE:CEQP), Enbridge Energy Partners (NYSE:EEP), EnLink Midstream Partners (NYSE:ENLK), and CorEnergy Infrastructure Trust (NYSE:CORR).

About ready to return to growth

Crestwood Equity Partners is a master limited partnership (MLP) that operates oil and natural gas pipelines, processing plants, and storage facilities across most of America's fastest-growing shale regions. Those midstream assets provide it with a relatively stable cash flow since 85% of its earnings come from fee-based contracts. The company uses that cash to support its generous distribution, which at the moment yields 8.8%, and which Crestwood covered with cash flow by a comfortable 1.4 times in 2017. Adding further support to the long-term sustainability of the payout is an improving balance sheet after leverage ended last year at 4.1 times EBITDA, down from 4.8 times at the end of 2015 and close to its target of 4.0 times. Meanwhile, with a boatload of high-return expansion projects underway, earnings should steadily rise in the coming years, which will not only further support the current payout, but could enable Crestwood to start increasing it later this year.

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Now as steady as a rock

Oil pipeline operator Enbridge Energy Partners currently has the highest yield of this group at 10.9%. But because the MLP completed several strategic initiatives last year, that payout appears to be on a firm foundation. Supporting that view is the fact that the company gets all its cash flow from stable sources like fee-based contracts, which will provide it with enough money to cover its payout by 1.15 times this year. Meanwhile, it has a solid investment-grade balance sheet, which should grow stronger as the embedded growth of its oil pipeline portfolio drives its debt-to-EBITDA ratio down to its 4.0 times target by 2020. Those metrics suggest the company's double-digit percentage yield should continue flowing to investors for years to come.

Solid and growing stronger

Pipeline and processing MLP EnLink Midstream Partners currently yields 10.2%. That payout looks likes it's on solid ground since 94% of EnLink's cash flow comes from fee-based contracts, and it expects to cover its payout by 1.0 to 1.1 times this year. EnLink also possesses a strong balance sheet, with a leverage ratio that's expected to be between 3.7 to 4.2 times this year. Meanwhile, the company has several expansion projects in the works that should increase cash flow. That should help improve its distribution coverage in the near term, and could eventually enable EnLink to start growing its payout once again.  

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Built on a solid foundation

CorEnergy Infrastructure Trust shares many similarities with the other companies on this list. However, it's not an MLP -- it's a real estate investment trust (REIT). That said, it owns similar energy infrastructure assets that also generate predictable cash flows and support the company's 8.3%-yielding dividend. That payout appears secure since CorEnergy covered it with cash flow by 1.3 times last year, and its leverage ratio was at the low end of the company's target range. Those solid financials provide CorEnergy Infrastructure with the financial flexibility to buy additional properties, which could eventually enable it to begin increasing its payouts.

Solid income streams

Investors who like dividends should love this quartet of stocks because they offer well-above-average yields. More importantly, they back those payouts with assets that generate stable cash flows, and have solid financial metrics. The numbers suggest that all four should be able to continue doling out their lucrative dividends for years to come.


Matthew DiLallo owns shares of CorEnergy Infrastructure Trust, Crestwood Equity Partners LP, and Enbridge Energy Partners. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.