{"id":22074,"date":"2025-10-23T03:00:58","date_gmt":"2025-10-23T03:00:58","guid":{"rendered":"https:\/\/finderica.com\/?p=22074"},"modified":"2025-10-23T03:00:58","modified_gmt":"2025-10-23T03:00:58","slug":"an-oil-and-gas-partnership-with-a-strong-7-8-yield","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=22074","title":{"rendered":"An Oil and Gas Partnership With a Strong 7.8% Yield"},"content":{"rendered":"
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It\u2019s been a while since I last looked at MPLX<\/strong> (NYSE: MPLX). At the time, the stock received a \u201cB\u201d for dividend safety.<\/p>\n

The company did not disappoint, as the dividend was not cut. In fact, it grew by 36% over the next three years.<\/p>\n

MPLX is a master limited partnership that processes and transports natural gas and oil. It was spun out from Marathon Petroleum in 2012.<\/p>\n

The stock pays a quarterly distribution of $0.9565, which comes out to a 7.8% yield. (MLPs pay distributions, not dividends.) It has boosted the distribution every year since it began paying one in 2013. Can it keep that impressive track record intact?<\/p>\n

MPLX and many other MLPs use a measure of cash flow called distributable cash flow, or DCF.<\/p>\n

Last year, MPLX\u2019s DCF totaled $5.7 billion. This year, it\u2019s expected to come in at $6 billion. In 2026, DCF is forecast to grow another 6% to $6.4 billion.<\/p>\n

Meanwhile, the company paid out $3.6 billion in distributions in 2024 for a payout ratio of just 63%. In other words, it paid investors 63% of the cash flow it generated. For MLPs, I\u2019m comfortable with any number below 100%, so 63% is very reasonable.<\/p>\n

This year, even though the distributions paid are expected to increase, the payout ratio is projected to dip to 60%.<\/p>\n

MPLX has always done a good job of paying a generous distribution without spending all of its cash flow.<\/p>\n

<\/a>\"Chart:<\/a><\/p>\n

MPLX has been growing its DCF and growing its payout to shareholders, but it\u2019s also left plenty of wiggle room should cash flow ever recede.<\/p>\n

The distribution is very safe.<\/p>\n

Dividend Safety Rating: A<\/strong><\/p>\n

\"Dividend<\/p>\n

What stock\u2019s dividend safety would you like me to analyze next? Leave the ticker in the comments section.<\/p>\n

You can also take a look to see whether we\u2019ve written about your favorite stock recently. Just click on the word \u201cSearch\u201d at the top right part of the Wealthy Retirement<\/em> homepage, type in the company name, and hit \u201cEnter.\u201d<\/p>\n

Also, keep in mind that Safety Net can analyze only individual stocks, not exchange-traded funds, mutual funds, or closed-end funds.<\/p>\n<\/p><\/div>\n