Enterprise Products Partners L P (EPD)

Stockchase Research Editor: Michael O'Reilly As a midstream energy services company, EPD does not face the same ups and downs as an energy producer. It makes its money on the margins its charges for its necessary services involved in processing, transportation and storage. It trades at 13x earnings, compared to peers at 21x and is trading under 2x book value. It has a great dividend that has grown for 23 consecutive years, backed a payout ratio of 85% (a bit high, but workable). It has smartly used some cash to paydown an estimated $1 billion in debt, putting the debt to earnings ratio at 3.5:1 -- very strong compared to peers. We would buy this with a stop loss at $18, looking to achieve $28.50 -- upside potential over 26%. Yield 8.03% (Analysts’ price target is $28.26)

(A Top Pick Aug 11/20, Down 9.3%)Stochchase Research Editor: Michael O'Reilly We have recommended to stop out of EPD as it has violated the $16.50 threshold we recommended. We see technical indications that the stock could retrace to $12. We will look for better opportunities elsewhere.

EPD is a dividend dynamo that is priced with 35% upside. The company provides midstream services for the energy sector. It is less about outright commodity prices, than it is about spreads between energy products. This makes it a less risky energy play. The higher payout ratio for the dividend at 84% merits watching, but the yield is very attractive at these price levels. We recommend a buy at current levels with a $16.50 stop loss. Yield 9.72% (Analysts’ price target is $24.57)