For income-oriented investors, there are two observations that stand out about the master limited partnership Buckeye Partners (BPL). The first is the partnership’s exceptionally high distribution yield. With a yield of 10.0%, Buckeye Partners is one of just 407 companies with 5%+ dividend yields.
Buckeye’s second notable characteristic is its tax-efficiency. As one of just 128 master limited partnerships, Buckeye’s distributions receive a unique tax treatment that is more optimal for income-focused investors.
Still, these two traits are enough by themselves to make Buckeye a buy. Investors must ensure that (1) the underlying business is performing well and (2) the company’s shares can be acquired at an attractive valuation. Fortunately, both of these criteria appear to be satisfied at the moment.
On Feb. 9th, Buckeye Partners reported financial results for the fourth quarter and full year of fiscal 2017. This article will analyze Buckeye’s earnings release and current valuation in…