Energy midstream stocks attract Wall Street interest via high dividends

Midstream energy companies are gaining attention on Wall Street due to strong dividend yields and financial performance.

Hess Midstream has maintained a 37-quarter run of dividend increases, with a yield of approximately 7.7% as of mid-August. The company aims for a 5% annualized growth in distributions through 2028 and utilizes a strategy involving buybacks, rising dividends, and debt management.

MPLX is also seeing increased interest, driven by its dominant position in natural gas gathering and processing within the Permian Basin. Following a solid second-quarter earnings report, the company returned $1.1 billion in capital to shareholders, supported by $1.5 billion in distributable cash flow. Financial institutions including Goldman Sachs and Barclays have issued positive ratings and price targets for the stock, noting its 7.2% dividend yield.