Did a Merger Make This 9.7% Yield More Secure?

This master limited partnership's dividend safety has improved with increasing cash flow.

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Did a Merger Make This 9.7% Yield More Secure? Marc Lichtenfeld, Chief Income Strategist, The Oxford Club Got $0.51? Then This Maryland Millionaire Has Something for YOU... He started out in child protective services with just $0.51 to his name... And now one secretive Maryland millionaire wants to help YOU get rich. Click here to see him reveal ALL his secrets.   In the summer of 2018, I analyzed the safety of master limited partnership (MLP) Energy Transfer Partners. At the time, the stock received a "C" rating. The issues were that cash available for distribution (CAD), a measure of cash flow for MLPs, was heading lower and the company's debt was too high.   Question of the Week   Have you made a profitable trade? Click here to answer.   Four months later, the MLP merged with its parent company, Energy Transfer Equity, and renamed itself Energy Transfer LP (NYSE: ET). Let's take a look at the new combined company and see if the distribution (partnerships pay distributions instead of dividends) is any safer. CAD is soaring. This chart says it all. This year, CAD is forecast to grow 13%. That helps keep the payout ratio to a low 43%. That means the company has plenty of room to pay the distribution. The distribution history is short. As a combined company, it has paid a distribution for only six quarters. Each time, it paid investors $0.31 per unit (partnerships have units, not shares). So the track record is short, but there are no distribution cuts to penalize the stock's dividend safety rating. The only downside is its debt. The company's net debt is nearly five times its earnings before interest, taxes, depreciation and amortization (EBITDA). That's too high, and it puts a dent in the rating.   December 11, 2019: The Day You Get Rich? Our research shows something peculiar could happen in just a few weeks. For some folks, it could lead to gains of 1,000% or more in the long run. Others could see their fortunes cut in half. Click here to see how you can set yourself up to profit.   That being said, investors don't have to worry too much. The company's cash flow more than covers its interest expense. As long as cash flow stays at current levels or continues to grow, and debt doesn't increase, the debt shouldn't be a problem. But it's something to keep an eye on. Other than that one issue, investors should continue to enjoy their 9.7% yield for years to come. Dividend Safety Rating: B If you have a stock whose dividend safety you'd like me to analyze, leave the ticker in the comments section. Good investing, Marc   Click Here to Comment   Let's "Make Americans RICH Again!" - Bill O'Reilly He's the highest-rated news host of all time... And the bestselling nonfiction author of all time... And today, he's revealing the secret way he's "made a lotta money." (Hint: It's NOT from his TV show.) Join Bill O'Reilly on his EXCLUSIVE new project to help Americans get rich. Go HERE now.   - More From Wealthy Retirement -     My Two-Minute Retirement Solution Steve offers his solution for the retirement funding crisis.   Should You Borrow Money From Your 401(k)? Account holders who are trying to pay down debt should consider their options when deciding whether to borrow from a 401(k).   Walk Over Your Investing Fears - and Earn a Perfect 10 Investors who manage their financial stress effectively will do their portfolios less damage in the event of a sell-off.       Find the Top 3 EXTREME Dividend Stocks? Palm Beach millionaire reveals how you could collect 100% on your savings every year... for life. His secret here.   You are receiving this email because you subscribed to Wealthy Retirement. To unsubscribe from Wealthy Retirement, click here. Need help with your account? Click here. Have a question or comment for the editor? Click here. 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