Several midstream companies have already announced increases to fourth-quarter dividends as earnings are underway.
The midstream segment is known for offering generous income, which is a primary reason many advisors use energy infrastructure ETFs in portfolios. Strong free cash flow generation and EBITDA growth from fee-based midstream businesses has supported continued dividend growth.
To be clear, fourth-quarter distributions refer to distributions paid during the first quarter of 2025 based on fourth-quarter 2024 operational performance.
Midstream Names Grow Dividends
Plains All American (PAA) / (PAGP) has announced the largest annual percentage increase to its distribution across midstream names that have announced fourth-quarter payouts.
Plains earlier this month announced a 20% increase to its distribution. This is an increase of $0.25 per unit annually, which is above the company’s guidance for a $0.15/unit annual increase. PAA’s quarterly distribution now exceeds 2019 levels.
See more: Plains CCO Discusses Permian Outlook & Capital Allocation Priorities
Williams Companies (WMB) has increased its quarterly dividend by 5.3% to $0.50 per share. Meanwhile, ONEOK OKE has grown its quarterly dividend by 4.0% to $1.03 per share.
Additionally, Hess Midstream (HESM) has increased its quarterly distribution to $0.7012 per share, representing a 10.5% year-over-year increase.
Enterprise Products Partners (EPD) has raised its quarterly distribution to $0.535 per unit. This is a 3.9% increase relative to the same quarter last year. EPD has been raising its distribution at the start of the year and again in the middle of the year in recent years, but has not provided specific guidance, according to VettaFi head of energy research Stacey Morris.
See more: Midstream/MLP Dividend Outlook: More Growth to Come
Energy Transfer (ET) grew its quarterly distribution to $0.3250 per unit, which is a 3.2% increase compared to the same quarter last year.
Finally, Targa Resources (TRGP) maintained its dividend for the fourth quarter of 2024 but reaffirmed its plans to recommend a 33.0% increase to its dividend for the first quarter of 2025.
ETF Exposure to Midstream Companies
Investors can get exposure to all six names — PAGP, WMB, OKE, HESM, EPD, and ET — with the Alerian Energy Infrastructure ETF (ENFR ).
ENFR tracks the Alerian Midstream Energy Select Index (AMEI). The index is a composite of North American energy infrastructure companies, which includes MLPs and C-corps. AMEI is yielding 5.1% as of January 29.
For more news, information, and analysis, visit the Energy Infrastructure Channel.
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