It’s an upstream MLP we’ve never recommended and I would steer well clear

I’ll be updating DPM this week in MLP Investing Insider. The short version is that it’s going to be a very challenging year for the. If they can avoid any more downgrades like the recent one by S&P, that will be a win. So would being able to meet the upper end of their guidance for quarterly distribution increases of “up to” a cent per unit, for growth above 5% this year. Doubt the upper end of any guidance that includes the words “up to,” though. What’s not in doubt is that they will survive and be OK in the long run, perhaps with help from Phillips 66. It’s a Hold here still.

Our web chats take place the second Tuesday of the month at 3 p.m. eastern. The next one’s on March 10; hope to hear from you there.

We’ve actually covered Dominion Midstream a few times prior to the IPO ( see http://www.investingdaily.com/mlp-profits/articles/19941/play-ball-more-ipos-on-deck/ and http://www.investingdaily.com/mlp-profits/articles/20276/dominion-faces-fight-over-lng-plans/ for example) but yeah, in retrospect blew it by not adding right after the IPO. It’s another one of these high-growth, big drop-down stories (like Shell, which thankfully we did add) that institutional investors currently find irresistible. Yield’s 1.7% annualized based on the last payout but 5.5% based on what they’re promising by the end of 2020. They could get there given that the Marcellus is perhaps the best shale basin of any, oil or gas, in the long run. But that’s still a lot of waiting for a yield that might look quite pedestrian if rates normalize in the meantime. Having missed the run-up, I’m disinclined to chase here, but no real reason to sell here either, that I can see.