If a 6%-plus yield sounds good to you, then you’ll want to jump on these two energy stocks while you still can.

If you are put off by the meager 1.5% or so yield you have to accept from an S&P 500 Index fund, then you’re likely to start salivating at the 6.1% yield from Enbridge ( ENB -1.82%) or the 7% yield from Enterprise Products Partners ( EPD -1.28%). The best part? These two midstream energy names have reliable businesses that handily cover the distributions they are paying. You will regret not doing a deep dive here if you are looking at dividend stocks today. Here are some important facts to get your research started. 1. Reliable businesses

Enterprise and Enbridge both own midstream energy infrastructure. That basically means they own the pipelines, storage, processing facilities, and transportation assets that help to move energy from where it gets brought up from the ground to where it gets consumed by end users. The vast majority of the revenues these two industry giants bring in are from fees, so the price of the commodities and products that flow through their systems is not the main driver of financial performance. Image source: Getty Images. This is a good thing because it means that investors can largely sidestep the commodity risk inherent in the often volatile energy sector . Demand is the bigger determinant of success, which might get some investors worried given the highly publicized shift toward clean energy . But don’t get too hung up on that because energy transitions take decades, and this one has only just begun. In fact, oil and natural gas demand is expected to increase until at least 2030. When you compare the global clean energy goals versus the actions taken by countries, there seems to be a major mismatch that suggests oil and natural gas aren’t going anywhere anytime soon, given the still-increasing size of the world’s population. 2. Ample support

Even companies with strong businesses can have unsupportable dividends, so that strong foundation is nice but not sufficient. That’s why it’s also nice to see that master limited partnership Enterprise reported that its distributable cash flow covered its dividend by a massive 1.9 times in the second quarter. That would provide a huge amount of financial leeway in the face of adversity. Enbridge’s dividend was covered by distributable cash flow by around 1.6 times in the quarter.

That said, Enbridge expects to have around $2 billion in excess cash flows each year over the next few years. It is currently using that to buy back stock, which makes per-share results even stronger. But it would likely prefer to put that cash to work on growth-oriented capital investments and acquisitions. Debt reduction is another option. While Enbridge may look slightly weaker when you examine distribution cash flow coverage, it is still in a very good financial position. 3. Growth ahead

Sticking with Enbridge, the company has a $10 billion pipeline of internal growth projects that will play out through 2027. These projects, meanwhile, span across natural gas, a natural gas utility the company owns, and clean energy. So Enbridge is not a one-trick pony and is actively shifting with the world around it on the clean energy front. It is purposefully limiting its investment in its oil pipeline assets, preferring to use the cash they generate to support growth elsewhere. The company is projecting distributable cash flow growth of between 5% and 7% through at least the next three years based on its investment pipeline.

Enterprise has roughly $5.5 billion worth of projects that will take it through 2025. Natural gas investments are a heavier focus, though petrochemicals also get a fair amount of attention. That said, the partnership has also been active on the acquisition front, recently buying privately held Navitas to expand its reach into the Midland basin, which complements its assets in the nearby Delaware basin. So there are more ways to grow than just internal development projects, and Enterprise appears ready to take whatever steps it needs to keep expanding its business. Those yields look increasingly juicy

There’s a lot more to dig into at both of these North American midstream giants, but their core operations, dividend safety, and future growth prospects are all notable positives. It’s also worth pointing out that they both have decades of annual distribution hikes behind them, so Enbridge and Enterprise both clearly care about returning value to investors over time. In today’s low-yield world, you […]

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