Motley Fool: Want an 8% dividend?

Enterprise Products Partners is one of the largest midstream pipeline companies in North America. (Courtesy Enterprise Product Partners)

Enterprise Products Partners (NYSE: EPD) has been an unstoppable dividend stock over the years, with its payout recently yielding a hefty 7.8%. One of the largest midstream pipeline companies in North America, it recently declared another dividend increase, something it has done for 23 consecutive years.

Enterprise’s stable midstream assets include about 50,000 miles of pipelines; 14 billion cubic feet of natural gas storage capacity; and 260 million barrels of storage capacity for natural gas liquids (NGLs), crude oil, refined products and petrochemicals. They generate steady, contractually secured cash flow. The company’s financial profile is top-tier, featuring an investment-grade credit rating backed by low debt levels and a conservative dividend payout ratio.

The company has recently added even more fuel for future growth by agreeing to acquire Navitas Midstream Partners from a private equity fund for $3.25 billion in cash. The deal gives Enterprise entry into the energy-rich Midland Basin.

It’s likely that North America will eventually move away from fossil fuels, hurting Enterprise’s business, but that won’t happen anytime soon. Note that the company is a Master Limited Partnership (MLP), and those can require some special handling at tax time; read up on MLPs before investing. (The Motley Fool has recommended Enterprise Products Partners.)

Ask the Fool

Q: What are Roth IRAs? – G.C., Dell Rapids, South Dakota

A: Individual retirement accounts come in two varieties – traditional and Roth. With a traditional IRA, your contributions reduce your taxable income, shrinking your tax bill for the year. For example, if you earn $66,000 and contribute $6,000, your taxable income drops to $60,000. When you withdraw the money in retirement, it’s taxed as ordinary income to you.

With a Roth IRA, you get no upfront tax break for your contributions; however, if you follow the rules, your eventual withdrawals can be completely tax-free. That can be a big deal: If you contribute significantly to your account over many years and that money is invested effectively, you might end up with hundreds of thousands of dollars in your account, available tax-free in retirement.

For both 2021 and 2022, contribution limits for traditional and Roth IRAs are $6,000, plus an additional $1,000 for those 50 and older. Note that the contribution deadline for IRAs is not Dec. 31, but the tax-filing deadline for the year. That means contributions for 2021 can be made until mid-April of 2022.

Also note that 401(k) accounts also come in traditional and Roth varieties. Learn more about retirement topics in our “Rule Your Retirement” service at Fool.com/services.

Q: Where can I look up a company’s historical stock prices? – R.P., Pearl, Mississippi

A: Try calling the company’s investor relations department and asking. Or head to a website that offers a lot of stock data: At Finance.Yahoo.com, for example, you can type in the company’s ticker symbol, and once you’re on its quote page, click on the “Historical Data” link.

My dumbest investment

In 2019, I saw a Motley Fool recommendation to invest in Zoom Video Communications. I bought $1,000 worth of shares for around $75 per share. A couple of months later, they were up by around $2 per share. So I sold, investing the proceeds in Southwest Airlines, which I believed would be a good investment. Being new to investing, I hadn’t yet learned patience. I can say that lesson has been learned. – S.B., online

The Fool responds: You certainly missed out on quite a ride with Zoom: It moved above $100 per share 10 months after debuting in the stock market, $150 a couple of months later and hasn’t returned – though it has been volatile. It topped $550 per share back in October 2020 during the thick of the pandemic, with many businesses, families and friends meeting via Zoom video sessions, and recently has been near $160 per share.

It’s perfectly reasonable to sell one stock and buy another if you have much more faith in the new holding’s future or you believe the former holding is significantly overvalued.

Airline stocks did fall to low levels after the pandemic curtailed much travel, with some investors seeing them as bargains and others suspecting that the pandemic and its effects might last a long time. Meanwhile, many see Zoom as attractively priced, while others think it could still fall further.

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