If you are retired, you have likely shifted from building your nest egg to living off your assets. That means you probably gravitate toward stocks that offer a mixture of safety and yield. Right now, you can find those features, to varying degrees, in energy industry stalwarts ExxonMobil (NYSE:XOM), Enterprise Products Partners (NYSE:EPD), and, for the more adventurous, Helmerich & Payne (NYSE:HP). Here's a primer on why retirees should consider buying these three energy stocks.

1. An integrated giant

Exxon is by far the best option for conservative investors. It's one of the largest and most diversified energy companies on the planet, with assets spanning the upstream (drilling), midstream, and downstream (chemicals and refining) sectors. The company has increased its dividend every year for an incredible 37 consecutive years, a record that none of its direct peers can match. And it offers a fat 4.6% or so yield. 

The word yield spelled out with dice sitting atop stacks of coins

Image source: Getty Images.

Before jumping in, though, you need to keep in mind that oil and natural gas are the driving force behind Exxon's results. Its downstream operations, which tend to benefit from low oil prices, can offset an oil price decline to some degree, but don't provide complete protection. And then there's the fact that Exxon's oil production has been in decline for a few years. That, however, appears to be turning for the better as a large drilling program has begun to bear fruit

The company's balance sheet, meanwhile, is among the strongest in the energy sector. Long-term debt is less than 10% of the capital structure, which is low for any company in any industry. And, more important, it means Exxon can afford to keep investing in its business (the current capital plan runs through 2025) while still supporting its dividend -- even if oil prices are weak. 

2. A temporary slowdown

Limited partnership Enterprise Products Partners is one of the largest midstream companies in North America, with a size and scale that few peers can match. Its collection of assets include pipelines, storage, processing facilities, transportation assets, and ports. It is a vital link between where energy gets produced and where it finally gets used. The key here is that most of Enterprise's business is fee-based. That means that demand for energy is far more important than the prices of oil and gas, and the various products into which they get turned.

This leads to very consistent cash flows and the ability to support a robust distribution. Enterprise's distribution yield is currently 5.8%, backed by 22 years of annual dividend increases. To keep that streak growing, the partnership has $5 billion worth of construction projects underway. The distribution, meanwhile, was covered by 1.6 times in 2018. That needs a little explanation, since 1.2 times is considered strong coverage in the midstream space. 

EPD Financial Debt to EBITDA (TTM) Chart

EPD Financial Debt to EBITDA (TTM) data by YCharts.

Enterprise is reducing its distribution growth rate for a couple of years so it can put more cash flow toward self-funding its growth. That will reduce the need for selling dilutive units to raise growth capital. This transition should be over in a year or two, at which point distribution growth is likely to head back to its historical mid-single-digit range. The best part is that Enterprise is making this transition without putting investors at risk, with leverage that remains near the low end of its peer group. This is another great option for conservative income investors, but keep in mind that there are tax considerations when it comes to limited partnerships, particularly with regard to tax-advantaged retirement accounts.

3. A little bit of risk

Next up is one for investors with a little more risk tolerance: Helmerich & Payne. This energy services company currently yields an impressive 5.6% backed by an almost unbelievable 46-year streak of annual dividend hikes. And the balance sheet is rock-solid, with long-term debt at just about 10% of the capital structure. But don't pull the trigger yet. 

The risk here is that the energy services sector is highly cyclical and capital intensive. Yes, Helmerich & Payne is financially strong, but that doesn't change the fact that commodity downturns tend to lead to a lot of red ink. In fact, the company is still working its way back from the 2014-2015 oil bear market, with just 62% of its rigs currently being used by customers. That said, the company's largest business by far is its onshore U.S. operation (about 90% of its fleet). This business has a utilization rate of 63%, but 90% of the company's most technologically advanced rigs -- the ones that command the highest price -- are in the field.   

HP Chart

HP data by YCharts.

Helmerich & Payne has long focused on owning and operating leading-edge technology rigs. It's working on upgrading its fleet so more of its rigs fall into the so-called super-spec category of highly efficient rigs that can move between drill sites witout being taken down and put back up again. The company's focus on being at the forefront of the industry is why it has gained around five percentage points of market share since the 2014-2015 downturn, easily besting its closest peers.   

Downturns hurt, but Helmerich & Payne has so far proven it can handle the ups and downs of the energy services industry. That said, when times are tough, investors start to question whether the company's dividend can survive. It's a legitimate concern, but if you're willing to trust management's commitment to the payout, Helmerich & Payne could be a good income option for more aggressive investors. 

Time for a deep dive

These three financially strong energy companies offer robust yields and impressive dividend histories. There are different premises backing each name, with Helmerich & Payne easily presenting the most risk. But if you are retired and looking to live off the income you generate from your nest egg, then Exxon, Enterprise, and even Helmerich & Payne are worth digging into today. You might like one or more of these high-yield stocks enough to add them to your portfolio.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.