Is Enterprise Products Partners (EPD) a High-Yield Passive Income Machine?

Enterprise Products Partners L.P. (NYSE:EPD) is included among the 10 Best Passive Income Stocks to Buy Now due to its dividend growth and high yield.

On July 9, the company declared a 2% hike in its quarterly dividend to $0.545 per share. Through this increase, the company stretched its dividend growth streak to 29 years.

In the first quarter of 2025, Enterprise Products Partners L.P. (NYSE:EPD) reported distributable cash flow (DCF) of $2.0 billion in the first quarter of 2025, marking a 5% rise from the $1.9 billion it posted in the same period last year. DCF covered the distribution 1.7 times over for the recent quarter, allowing the company to retain $842 million in cash flow. Its adjusted cash flow from operations (CFFO) came in at $2.1 billion for the first quarter of both 2025 and 2024. For the twelve-month period ending March 31, 2025, adjusted CFFO totaled $8.6 billion. During that same period, the company’s payout ratio— which includes distributions to common unitholders and share buybacks— stood at 56% of adjusted CFFO.

In addition to dividend growth, Enterprise Products Partners L.P. (NYSE:EPD) also offers a solid dividend yield, which stands at 6.71%, as of July 10. The company ranks among the largest publicly traded partnerships and is a key midstream energy provider in North America, offering essential services to both producers and consumers of natural gas, natural gas liquids (NGLs), crude oil, refined products, and petrochemicals.

While we acknowledge the potential of EPD as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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