Before You Buy Energy Transfer or Enterprise Products for the Yield, Here's the Complication Nobody Mentions.
Both of these high-yield stocks will require a little extra attention when you're filing taxes.
Overview
Energy Transfer (NYSE: ET) and Enterprise Products Partners (NYSE: EPD) are both popular stocks among income investors. They're both midstream pipeline companies that are well-insulated from volatile commodity prices because they simply charge downstream and upstream "tolls" to use their infrastructure. As long as those resources keep flowing through their pipelines, they can generate plenty of cash to fund their big distributions.
Energy Transfer, which operates more than 140,000 miles of pipeline across 44 states, pays a forward yield of 6.3%. Enterprise, which operates over 50,000 miles of pipeline across 27 states, pays a forward yield of 5.6%. Both companies have historically spent only about half of their distributable cash flow (DCF) on distributions, so they can easily cover those yields.
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Originally published at www.fool.com.