Master Limited Partnerships by Malcolm Berko on Creators.com

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Stolen Wallet Leads to a Huge Headache Dear Mr. Berko: My wallet was stolen a year ago, and most folks have no idea what a job it has been to get my life back in order. The credit agencies have me listed as a bum, even though I pay all my real bills, and I still get calls from vendors …Read more. Kick That Broker to the Curb Dear Mr. Berko: We are 74 and 76. We've used the same broker since early 2002, and our account, which was worth $765,000 back then, is barely worth $705,000 today. Our mutual funds haven't done well, and we've lost money in various unit trusts. Our …Read more. Would the Real Malcolm Berko Please Stand up? Dear Mr. Berko: What stock exchange firm do you work for? Is it true that you accumulate a big holding of a stock for all of your clients and then write good things about that stock in your newspaper column so that millions of investors will read …Read more. Natural Gas Firm Looking Like a ‘Buy' Dear Mr. Berko: A long-time friend of mine (name omitted) who says he knows you well has had some good successes in the market during the past six years buying oil and gas limited partnerships, high-yielding convertibles and preferreds. He just …Read more.

Master Limited Partnerships

Dear Mr. Berko: Can you give me the names of seven stocks to consider that yield better than 8 percent and have raised their dividends at least by 50 percent in the past decade? I can afford modest risk to achieve my objectives and would like to invest about $16,000 in five or six different issues. — H.E.

Dear H.E.: I don't know your risk profile so I can't determine if the following issues meet your requirements. And because an 8 percent yield plus dividend growth is hard to find, I'd like you to consider some publicly traded Master Limited Partnerships. Most MLPs are in the pipeline, storage and transportation business, which provides a modicum of protection from the price volatility of the energy business. Pipeline MLPs get paid for the volume of product that passes through the pipeline so the cost of gas or oil doesn't affect them. The yields are extremely attractive and because the MLP passes its depreciation to the investor, a large portion of the dividends is not taxable. However, the portion that isn't taxable reduces the cost basis of your shares. MLPs are best held in taxable accounts because you lose the tax advantage if they are owned in a retirement account. Most of the following MLPs have a good record of dividend growth and are trading at lower prices than they did one or two years ago.

ONEOK PARTNERS LP (OKS-$51.10) with $6.2 billion in revenues, traded in the mid $60s during the last 12 months and its $4.32 dividend, which has increased in each of the past 10 years, yields 8.5 percent. This natural gas pipeline is the largest in the nation and is superbly operated by a seasoned management team. OKS trades at 12 points below its 52-week high price.

PENN VIRGINAL HOLDINGS LP (PVG-$12.69), a $900 million revenue LP has been doing business since 1882 and became public in December 2006 at $20. The $1.52 dividend, which has increased 50 percent since the December IPO, yields 12.3 percent. PVG operates a midstream natural gas gathering and processing business and manages a number of coal and natural resource properties.

PVG's 52-week high share price was $33.

CALUMENT SPECIALTY PRODUCTS PARTNER LP (CLMT-$14.34) is a $1.8 billion producer of high-quality special hydrocarbon products. CLMT processes oil into customized lubricants, white oils, solvents, waxes, lighter fuels, candles, petroleum jelly, creams, lotions, tonics, transmission fluids, aerosols, jet, diesel and automobile fuels. CMLT has been in business since 1916 and its $1.80 dividend, which yields 12.6 percent and has increased 50 percent since becoming public in late 2006. The shares trade at their 52-week high.

DUNCAN ENERGY PARTNERS LP (DEP-$18.00) is a $1.3 billion revenue company that gathers, transports, markets and stores natural gas liquids and petrochemicals via 9,500 miles of pipeline. Since becoming public at $22 in January 2007, the $1.74 dividend, which yields 9.6 percent, has nearly doubled. DEP trades two points below its 52-week high of $20.

DCP MIDSTREAM PARTNERS LP (DPM-$23.96) is a $1.1 billion revenue LP that gathers, compresses, treats and sells natural gas, natural gas liquids and propane. The $2.40 dividend yielding 10 percent has nearly doubled since the company became public at $22 in December 2005. DPM now trades about eight points below its 52-week high.

TRANSMONTAIGNE PARTNERS OP (TLP-$26.60) pays a $2.36 dividend, which yields 8.6 percent and has grown 50 percent since coming public at $25 in May of 2005. TLP operates as a terminaling and transportation company and provides storage for customers who sell various refined petroleum products. TLP trades 2 points under its 52-week high.

TEEKAY LNG PARTNERS L.P. (TGP-$21.40) pays a $2.28 dividend yielding 10.2 percent that has more than doubled since becoming public at $25 in May 2005. TLP provides marring transportation for natural gas and petroleum gasses (propane, butane, ethane, ethylene, ammonia and propylene) with a fleet of 18 tankers. The shares trade four points below its 52-week high of $25.25.

Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, FL 33775 or e-mail him at mjberko@yahoo.com. To find out more about Malcolm Berko and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.