Cash in with double-digit yields.
Many investors still struggle to find income and yield in today’s low interest-rate environment. Interest rates on most bank savings accounts remain less than 1 percent, and even Treasury notes offer little bang for your buck. (A two-year Treasury note currently yields about 0.66 percent.) In this landscape, investors hungry for yield are turning to dividend-paying stocks. We found seven energy stocks that offer fat double-digit dividends, which can provide some cushion even if the stock market comes under pressure.
Vanguard Natural Resources (ticker: VNR)
Vanguard Natural Resources owns and develops oil and natural gas properties in the U.S. Vanguard’s revenues are largely tied to the price of crude oil and natural gas, and many investment banks forecast higher crude oil prices next year. TD Bank forecasts an average of $49.40 per barrel for West Texas Intermediate crude oil in 2015, with a $54.75 average in 2016 and a $66.25 average in 2017. VNR stock boasts a plump dividend yield at nearly 17 percent.
NGL Energy Partners (NGL)
NGL Energy Partners is in the oil and gas refining and marketing industry. NGL stock is at a 52-week low and has a short-term price target of $33.50 from Zacks Investment Research, making it ripe for bargain-hunting energy investors. Another positive sign is the purchase of 10,000 shares of NGL stock by CEO Michael Krimbill in August; analysts track insider buying as a potential indicator for a stock’s strength. NGL stock offers a generous dividend yield of 14.5 percent.
Northern Tier Energy (NTI)
Northern Tier Energy is an independent refiner and pipeline operator that produces gasoline, diesel and jet fuel. Refiners are in a strong position because they benefit from lower input costs of depressed crude oil prices, while maintaining strong profit margins for their refined products. Falling U.S. gasoline inventories can help drive gasoline prices higher and are supportive to increased revenues for refiners. NTI stock offers a dividend yield of 18.3 percent.
CVR Refining (CVRR)
CVR Refining refines crude oil into gasoline and distillates at its two refineries in Oklahoma. The company’s Midwest location allows it to rely heavily on the cheaper WTI crude oil as opposed to more expensive Brent crude. The stock has been on a tear, climbing 18 percent since late August, and offers a fat dividend yield at 18.7 percent.
Alon USA Partners (ALDW)
Alon USA Partners operates a crude oil refinery in Big Spring, Texas. It converts crude oil into various products, including gasoline, diesel and jet fuel, and has throughput capacity of 73,000 barrels per day. Alon USA Partners bucked the trend of many energy companies this year by posting strong gains, climbing more than 80 percent since January. ALDW stock offers a dividend yield of 17.7 percent.
Seadrill Partners (SDLP)
Seadrill Partners owns and operates offshore drilling units. The company’s stock is trading in the lower third of its 52-week range, but Zacks Investment Research ranked Seadrill Partners a “buy” following a number of upward revisions to its earnings outlook. SDLP stock recently climbed above its 50-day moving average, which is a positive technical chart signal for investors, and posts an attractive price-to-earnings ratio of 4.6. The dividend yield is 21.2 percent.
Exterran Partners (EXLP)
Exterran Partners provides natural gas contract operations services to customers in the U.S. Over the past month, bullish analysts upwardly revised earnings projections by 8.4 percent for Exterran, with full-year earnings now projected at $1.17 per share. Zacks Investment Research ranks EXLP stock as a “strong buy.” The dividend yield stands at 11.4 percent.
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