Cheniere Energy Partners LP
Cheniere Energy Partners LP (AMEX:CQP) is a great example of the difference between conventional energy stocks that might be suffering and related MLPs that are thriving. In the past 12 months, parent company Cheniere Energy Inc. (AMEX:LNG) — a conventional for-profit energy stock — is down about 80% and has been bleeding cash since before 2008 thanks to the crash in natural gas prices.
However, while Cheniere Energy Inc. is painfully unprofitable, the partnership with the same name is thriving — up more than 17% in the last year, with a current yield of 6%.
Why? Well, primarily because CQP is not affected by natural gas prices. It gets paid simply by volume as it passes natural gas through its Sabine Pass hub just east of Houston. It is one of a precious few deepwater ports along the Gulf Coast suitable for importing and exporting liquefied natural gas.
Considering the massive domestic supply of natural gas and the fact that the fuel burns cleaner than coal or oil, this has big long-term potential. A boost in energy exports would be a boon to CQP — and to distributions of this MLP.
If you like this pick, just be careful to use the correct symbol — CQP for the partnership.