Summit Midstream Partners, LP
Year-to-Date Gain: 73%
Dividend Yield: 5.1%
You had to know that a limited partnership would make its way into this list.
The one that’s put on the biggest show so far in 2013 is Summit Midstream Partners LP (SMLP), a natural gas MLP that hit the markets in late 2012. Year-to-date, the company has posted a 73% climb — that’s nearly four times the broader market.
One obvious reason to like Summit: The natural gas market has a promising future as an alternative to coal. SMLP recently made two acquisitions in the Bakken and Marcellus shales — both promising regions in the natural gas landscape.
And the kicker is that — as a midstream firm — SMLP doesn’t have to worry about the nitty gritty of extraction, the economics of selling to people, or even natural gas prices. Instead, it’s really just a glorified toll taker; it provides natural gas gathering and compression services, charges some money, then passes along most of that money to unitholders.
While there’s not a long payout history to look at here, natural gas’ promising prospects mean there’s a good chance its distributions — currently at 43.5 cents quarterly — will keep marching upward.