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3 Energy Plays to Look At: Raymond James Exec

Wednesday, 3 Aug 2011 | 1:53 PM ET

Investors can generate income by having master limited partnerships play a bigger role in their portfolio, Darren Horowitz, managing director of Energy Equity Research at Raymond James & Associates, told CNBC Wednesday.

"When we look at energy infrastructure, especially in at 2.5 percent 10-year Treasury environment,we think that is an excellent place for investors when you consider the total return aspects of this MLP asset class," Horowitz said.

Darren Horowitz's top three MLP picks ...

Plains All American Pipeline L.P. is a partnership that touches over 3 million barrels of crude oil and refine product a day.

"It's about 6.4 percent on yield, and we think they can grow the distribution between four and five percent over the long-term," he explained.

PAA is one "of the best geograhic asset plays and also very vertically intregrated throughout the supply."

Magellan Midstream Partners L.P. is a crude oil and refine products transport and storage company, and yields 5.4 percent.

"They can grow their distribution about seven percent year-over-year for the next couple of years," Horowitz said..

Enterprise Products Partners L.P. yields 5.8 percent and has an "excellent asset footprint, very transperant growth, prudence in capital allocation, and we think somewhere between a four to five percent growth rate," he concluded.

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PAA
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MGM
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