As part of a series on upstream MLPs, I've been scouring the industry trying to help Investors compare these high-yielding ways of participating in America's historic oil and gas boom. Historically speaking, there have been five major metrics that contribute to long-term total returns: yield, distribution growth, distribution safety, valuation, and volatility.
After investigating all the major upstream MLPs in the industry, I thought readers may enjoy a final article that ranks these income titans by the thing long-term investors treasure most: expected long-term total returns.
A word of caution about this method of ranking MLPs: It's just a screening tool, a starting point for further research. These are 10-year projections I'm using, courtesy of S&P Capital IQ. They must be taken for what they are: educated guesses based on factors such as past performance, future commodity price trends, and acquisition potential. The ranking also doesn't take into account qualitative factors such as quality of management, changes in partnership strategy, or one-time events.
However, I do feel this method can be illuminating for no other reason than it increases exposure to one of the best income-generating industries in America and sheds light on metrics many investors don't know about or pay attention to. It also brings to light lesser-known MLPs. Sometimes these can prove to be better investments than some better-known names such as Linn Energy (NASDAQOTH:LINEQ) and its non-MLP alternative Linn Co (UNKNOWN:LNCO.DL). One such example is Mid-Con Energy Partners (NASDAQ:MCEP), the second smallest MLP in the industry, but one that has many attributes making it worthy of consideration by income investors.
Keeping its limitations in mind, let's examine the 12 most popular upstream MLPs in America and see which ones are expected to perform the best over the next decade.