Last year, the company generated $8.3 billion in distributable cash flow, up from $7.6 billion in 2023. It paid investors $4.6 billion in distributions for a payout ratio of 55%. So, the company was easily able to afford its distribution. In 2025, the company is projected to grow distributable cash flow to $8.4 billion, while distributions paid is anticipated to shrink to $3.9 billion, for a 46% payout ratio. While Energy Transfer's financials look stellar, the company did cut the distribution in 2020 when times got tough. Sometimes, it's the prudent thing to do. But I prefer a management team that will do whatever it takes to preserve the dividend. Energy Transfer has shown that it will reduce the distribution, which gets a penalty in the dividend safety rating. However, Energy Transfer has been growing its distribution per share to investors for the past few years and generates plenty of cash flow to do so. Is the MLP's recent track record strong enough to keep it from cutting again? |
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