In the realm of midstream sector investments, Enterprise Products Partners (NYSE: NYSE:EPD) has consistently outperformed Kinder Morgan (NYSE: NYSE:KMI), offering a more attractive proposition for conservative investors seeking steady and reliable income. A key factor in this disparity is Enterprise's robust track record of increasing dividends for 25 consecutive years, a feat that Kinder Morgan has been unable to replicate due to unexpected dividend cuts in 2016 and during the COVID-19 pandemic in 2020.
These dividend cuts have led to trust issues among investors, making Kinder Morgan a less desirable option. The company's total return history significantly trails that of Enterprise, with a stark difference of nearly 90 percentage points over the past decade. This has resulted in substantial investor losses for those who chose Kinder Morgan over its competitor.
Today, Kinder Morgan's dividend yield stands at 6.7%, whereas Enterprise offers a higher distribution yield of 7.2%. This further solidifies Enterprise's position as a superior investment choice for those seeking higher income generation. Given these circumstances, it's clear that Enterprise's consistent dividend increases and its higher yield are more attractive to investors looking for steady and reliable returns.
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