There aren't many stocks that can boast a 7% dividend yield. Energy Transfer LP (ET 0.55%) is one of them. The midstream company provides steady income to investors, while it's simultaneously strengthening its operations. Energy Transfer could be the best dividend stock of the year.
NYSE: ET
Key Data Points
Energy Transfer currently pays an annual dividend of $1.34 per share. The company's dividend has been modestly but steadily increasing over the past few years. The stock is also up by more than 16% year to date. The appreciation in share price has lowered the dividend yield, but it still hovers around 7%. The company expects its long-term distribution growth rate to increase 3% to 5% annually.
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Analysts are largely aligned in rating Energy Transfer a "buy," and it trades below Wall Street's average target price. The stock's forward P/E ratio is 11.5, and the PEG is well under 1 at 0.64. For investors searching for solid businesses at fair prices, Energy Transfer fits the bill.
Energy Transfer's outlook is also strong. The company expects to invest more than $5 billion in projects to enhance its natural gas network. The expansions, along with long-term commitments, could potentially support returns in the mid-teens, according to the company.
The current geopolitical conditions are also highly favorable for Energy Transfer. The Trump administration recently announced a shift away from wind energy to reallocate funds into natural gas.
For long-term investors seeking high-yield income, Energy Transfer is more than just a compelling case. It could be the best cash-flowing opportunity in 2026.
