This 13.7%-Yielding Stock Plans to Keep Increasing Its Dividend in 2020

Western Midstream (NYSE:WES) has quietly put together an excellent dividend track record. The master limited partnership (MLP) has increased its payout in each of the past 27 consecutive quarters. That steady growth has boosted the yield on its distribution to an eye-popping 13.7%. The concern, however, is that when a dividend yield gets that high, it's often a sign that a reduction is on the way. But that doesn't seem to be the case with Western Midstream's payout. That was one of the clear takeaways from the energy company's third-quarter conference call, as its management team expects to continue growing the payout in 2020.

Western Midstream's CEO, Michael Ure, provided investors with the company's preliminary outlook for 2020. He stated that "we expect significant year-over-year adjusted EBITDA growth of approximately 10%." He then pointed to several factors that would fuel this growth. The company has several expansion projects that either came online in late 2019 or will start up next year, which will help drive higher volumes across its midstream systems. As those volumes ramp up, they'll boost the company's earnings.

Source: Motley Fool

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