Is Energy Transfer's 18.7%-Yielding Dividend Sustainable?

Energy Transfer (NYSE:ET) pays a monster cash distribution. Given the big slide in its unit price, -- they're down more than 50% in the past year -- the master limited partnership currently yields an eye-popping 18.7%. Usually, when a payout's that high, it's because the market doesn't believe it's sustainable. However, when it comes to Energy Transfer's payout, it's not so cut and dried. Here's a look at why it's not clear what the future holds for this massive payout.

The payout's future seems uncertain - Energy Transfer clearly values its investment-grade credit rating above its current distribution level, and it would cut the payout if that were the key to keeping its rating intact. That leaves the payout's future up in the air, making Energy Transfer a less-than-ideal option for income investors these days since there's a risk that its big-time payout might not last.

Source: Motley Fool

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