With such a broad range of MLPs out there right now, investors have many options. Distributions from these companies are vital to shareholders' total returns. This key fact is why the stability of the long-term, fee-based contracts of the midstream MLPs are a great place for investors to focus.
Take this long-term revenue stream and compare it to that of MLPs that produce oil and natural gas, and its clear that distribution growth and stability should be much more reliable at a midstream company like Kinder Morgan Energy Partners (NYSE:KMP). Risk is also reduced because expected production from wells is not always guaranteed.
Joel South has no position in any stocks mentioned. Taylor Muckerman has no position in any stocks mentioned. The Motley Fool recommends Enterprise Products Partners L.P. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.