Maximize Your Passive Income with Higher-Yielding Energy Stocks: Plains All American Pipeline and Western Midstream Partners

Energy Transfer offers an attractive 7.5% yield, but Plains All American Pipeline and Western Midstream Partners offer higher-yielding payouts (8.5% and 9.5%, respectively) with similarly strong financial profiles. Plains All American owns and operates midstream energy infrastructure, primarily collecting a fixed fee for crude oil and natural gas liquids flowing through its network. The MLP expects to produce enough cash to cover its high-yielding distribution by 1.75 times this year, backed by a strong balance sheet and a 3.3x leverage ratio. Plains All American invests in expanding its operations, aiming to increase its payout by around 10% annually.

Energy Transfer (NYSE: ET) stands out in the energy sector for its attractive distribution, currently yielding over 7.5%. However, for those seeking higher-yielding investments, Plains All American Pipeline (NASDAQ: PAA) and Western Midstream Partners (NYSE: WES) offer more compelling options, with yields of 8.5% and 9.5%, respectively [1].

Plains All American Pipeline, which owns and operates midstream energy infrastructure focused on crude oil and natural gas liquids (NGLs), currently yields 8.5%. The company's system processes about 8 million barrels of oil and NGLs daily, primarily through fixed fees. Plains All American expects to cover its high-yielding distribution by 1.75 times this year, backed by a strong balance sheet and a 3.3x leverage ratio [1]. The company's disciplined debt management and strategic acquisitions, such as its 20% interest in BridgeTex Pipeline Company, position it for sustainable growth and distribution increases [1].

Western Midstream Partners, which provides natural gas, crude oil, and produced water services, offers a 9.5% yield. The MLP expects to generate $1.3 billion to $1.5 billion of free cash flow this year, enough to cover its distribution and maintain its operations. Western Midstream's acquisition of Aris Water Solutions and its organic expansion projects, like the North Loving II gas processing plant, further enhance its growth prospects [1].

While Energy Transfer remains a dominant player in the midstream sector, Plains All American and Western Midstream present compelling alternatives. Both companies offer higher-yielding payouts and stronger financial profiles, making them smarter investments for those seeking to maximize the income produced from every $100 invested [2].

References:

[1] https://finance.yahoo.com/news/forget-energy-transfer-smartest-high-010600413.html
[2] https://www.ainvest.com/news/investors-choose-paa-wes-energy-transfer-high-yield-energy-income-2508/