Dividends4Life: 9% Yield, No K-1, Strong Coverage

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9% Yield, No K-1, Strong Coverage

Posted by D4L | Monday, September 28, 2020 | | 0 comments »

Looking for more security in the high yield space? Maybe you should consider preferred shares, particularly cumulative preferreds. This security yields 9.25%, with 3.4X net income/preferred distribution coverage. Although the common units yield over 16%, the preferred units have performed much better. It issues a 1099, no K-1.

Hoegh LNG Partners LP, 8.75% Series A Cumulative Redeemable Preferred Units (HMLP.PA) from Hoegh LNG Partners LP (HMLP) is a pure play on FSRU's. FSRU stands for "Floating Storage & Regasification Unit." FSRU's have been a rapidly-growing presence in the LNG shipping industry in the last few years. HMLP's parent/sponsor, Höegh LNG Holdings Ltd., is the largest provider of FSRU's in the market. FSRU leasing/chartering solves many problems for charterer companies and countries. It's slow and expensive to build an LNG import terminal, so FSRU's are being increasingly used to give countries access to LNG.

Source: Seeking Alpha

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