Best Dividend Stocks: Top Pipeline Stock Raises Dividend Again, Delivers 7.3% Yield

Top pipeline stock Enterprise Products Partners (EPD) is back in focus after the company once again raised its dividend for investors.

On July 6, the company announced a 5.6% increase to its dividend, with the next payment of 47.5 cents to be paid out on Aug. 12 to shareholders as of Friday, July 29.

Dividend increases are the norm for this company. Enterprise Products has increased its dividend an astounding 74 times since its IPO in 1998.

7.3% Yield Makes Enterprise Products Top Dividend Stock

Enterprise Products runs over 50,000 miles of crude and natural gas pipelines across the American Midwest. It also operates natural gas storage and processing sites.

The firm currently boasts an annualized dividend yield of 7.3%, well above the 1.5% average yield of the S&P 500. In addition to its impressive dividend, earnings growth is expected for the next several years. After reporting earnings of $2.20 per share last year, EPS is expected at $2.47 and $2.58 in 2022 and 2023 respectively.

Strong results have been largely due to soaring energy prices, especially natural gas. The commodity has surged amid geopolitical tensions.

Enterprise Products to Report Earnings Aug. 3

Enterprise Products will report its second-quarter earnings next Wednesday. Earnings are estimated at 62 cents per share on revenue of $12.26 billion, according to FactSet.

While earnings will be in focus, a larger discourse will certainly be played out around volatile energy prices. The biggest risk to Enterprise Products is a large decline in energy prices, which could be caused by a recession or a thawing of geopolitical tensions with Russia.

However, as a pipeline stock, cash flows are more stable; a BBB+ debt rating from S&P gives investors some assurance that the company is well suited to meet its dividend obligations.

Nonetheless, volatile energy prices have caused stock volatility. After reaching a new high in early June, Enterprise Products lost 20% in a single week before rebounding this month.

Shares are currently forming a cup base with a 28.75 buy point. The stock climbed back above the 50-day moving average the past few days.