Category Monthly Dividend

Updated on March 17th, 2025 by Bob Ciura

Spreadsheet data updated daily

Master Limited Partnerships – or MLPs, for short – are some of the most misunderstood investment vehicles in the public markets. And that’s a shame, because the typical MLP offers:

1. Tax-advantaged income
2. High yields well in excess of market averages
3. The bulk of corporate cash flows returned to shareholders through distributions

An example of a ‘normal’ MLP is an organization involved in the midstream energy industry. Midstream energy companies are in the business of transporting oil, primarily though pipelines. Pipeline companies make up the vast majority of MLPs.

Since MLPs widely offer high yields, they are naturally appealing for income investors. With this in mind, we created a full downloadable list of nearly 100 MLPs in our coverage universe.

You can download the Excel spreadsheet (along with relevant financial metrics like dividend yield and payout ratios) by clicking on the link below:

 

This comprehensive article covers MLPs in depth, including the history of MLPs, unique tax consequences and risk factors of MLPs, as well as our 7 top-ranked MLPs today.

The table of contents below allows for easy navigation of the article:

Table of Contents

The History of Master Limited Partnerships

MLPs were created in 1981 to allow certain business partnerships to issue publicly traded ownership interests.

The first MLP was Apache Oil Company, which was quickly followed by other energy MLPs, and then real estate MLPs.

The MLP space expanded rapidly until a great many companies from diverse industries operated as MLPs – including the Boston Celtics basketball team.

One important trend over the years, is that energy MLPs have grown from being roughly one-third of the total MLP universe to containing the vast majority of these securities.

Moreover, the energy MLP universe has evolved to be focused on midstream energy operations. Midstream partnerships have grown to be roughly half of the total number of energy MLPs.

MLP Tax Consequences

Master limited partnerships are tax-advantaged investment vehicles. They are taxed differently than corporations. MLPs are pass-through entities. They are not taxed at the entity level.

Instead, all money distributed from the MLP to unit holders is taxed at the individual level.

Distributions are ‘passed through’ because MLP investors are actually limited partners in the MLP, not shareholders. Because of this, MLP investors are called unit holders, not shareholders.

And, the money MLPs pay out to unit holders is called a distribution (not a dividend).

The money passed through from the MLP to unit holders is classified as either:

• Return of Capital
• Ordinary Income

MLPs tend to have lots of depreciation and other non-cash charges. This means they often have income that is far lower than the amount of cash they can actually distribute. The cash distributed less the MLPs income is a return of capital.

A return of capital is not technically income, from an accounting and tax perspective. Instead, it is considered as the MLP actually returning a portion of its assets to unit holders.

Now here’s the interesting part… Returns of capital reduce your cost basis. That means taxes for returns of capital are only due when you sell your MLP units. Returns of capital are tax-deferred.

Note: Return of capital taxes are also due in the event that your cost basis is less than $0. This only happens for very long-term holding, typically around 10 years or more.

Each individual MLP is different, but on average an MLPs distribution is usually around 80% to 90% a return of capital, and 10% to 20% ordinary income.

This works out very well from a tax perspective. The images below compare what happens when a corporation and an MLP each have the same amount of cash to send to investors.

Note 1: Taxes are never simple. Some reasonable assumptions had to be made to simplify the table above. These are listed below:

• Corporate federal income tax rate of 21%
• Corporate state income tax rate of 5%
• Qualified dividend tax rate of 20%
• Distributable cash is 80% a return of capital, 20% ordinary income
• Personal federal tax rate of 22% less 20% for passive entity tax break
  (19.6% total instead of 22%)
• Personal state tax rate of 5% less 20% for passive entity tax break
  (4% total instead of 5%)
• Long-term capital gains tax rate of 20% less 20% for passive entity tax break
  (16% total instead of 20%)

Note 2: The 20% passive income entity tax break will expire in 2025.

Note 3: In the MLP example, if the maximum personal tax rate of 37% is used, the distribution after all taxes is $8.05.

Note 4: In the MLP example, the accrued cost basis reduction tax is due when the MLP is sold, not annually come tax time.

As the tables above show, MLPs are far more efficient vehicles for returning cash to shareholders relative to corporations. Additionally, in the example above $9.57 out of $10.00 distribution would be kept by the MLP investor until they sold because the bulk of taxes are from returns of capital and not due until the MLP is sold.

Return of capital and other issues discussed above do not matter when MLPs are held in a retirement account.

There is a different issue with holding MLPs in a retirement account, however. This includes 401(k), IRA, and Roth IRA accounts, among others.

When retirement plans conduct or invest in a business activity, they must file separate tax forms to report Unrelated Business Income (UBI) and may owe Unrelated Business Taxable Income (UBTI). UBTI tax brackets go up to 37% (the top personal rate).

MLPs issue K-1 forms for tax reporting. K-1s report business income, expense, and loss to owners. Therefore, MLPs held in retirement accounts may still qualify for taxes.

If UBI for all holdings in your retirement account is over $1,000, you must have your retirement account provider (typically, your brokerage) file Form 990-T.

You will want to file form 990-T as well if you have a UBI loss to get a loss carryforward for subsequent tax years. Failure to file form 990-T and pay UBIT can lead to severe penalties.

Fortunately, UBIs are often negative. It is a fairly rare occurrence to owe taxes on UBI.

The subject of MLP taxation can be complicated and confusing. Hiring a tax professional to aid in preparing taxes is a viable option for dealing with the complexity.

The bottom line is this: MLPs are tax-advantaged vehicles that are suited for investors looking for current income. It is fine to hold them in either taxable or non-taxable (retirement) accounts.

Since retirement accounts are already tax-deferred, holding MLPs in taxable accounts allows you to ‘get credit’ for the full effects of their unique structure.

4 Advantages & 6 Disadvantages of Investing in MLPs

MLPs are a unique asset class. As a result, there are several advantages and disadvantages to investing in MLPs. Many of these advantages and disadvantages are unique specifically to MLPs.

Advantages of MLPs

Advantage #1: Lower taxes

MLPs are tax-advantaged securities, as discussed in the “Tax Consequences” section above. Depending on your individual tax bracket, MLPs are able to generate around 40% more after-tax income for every pre-tax dollar they decide to distribute, versus Corporations.

Advantage #2: Tax-deferred income through returns of capital

In addition to lower taxes in general, 80% to 90% of the typical MLPs distributions are classified as returns of capital. Taxes are not 0wed (unless cost basis falls below 0) on return of capital distributions until the MLP is sold.

This creates the favorable situation of tax-deferred income.

Tax-deferred income is especially beneficial for retirees as return on capital taxes may not need to be paid throughout retirement.

Advantage #3: Diversification from other asset classes

Investing in MLPs provides added diversification in a balanced portfolio. Diversification can be measured by the correlation in return series between asset classes.

MLPs are excellent diversifiers, having either a near zero or negative correlation to corporate bonds, government bonds, and gold.

Additionally, they have a correlation coefficient of less than 0.5 to both REITs and the S&P 500. This makes MLPs an excellent addition to a diversified portfolio.

Advantage #4: Typically very high yields

MLPs tend to have high yields far in excess of the broader market. As of this writing, the S&P 500 yields ~2.1%, while the Alerian MLP ETF (AMLP) yields over 25%. Many individual MLPs have yields above 10%.

Disadvantages of MLPs

Disadvantage #1: Complicated tax situation

MLPs can create a headache come tax season. MLPs issue K-1’s and are generally more time-consuming and complicated to correctly calculate taxes than ‘normal’ stocks.

Disadvantage #2: Potential additional paperwork if held in a retirement account

In addition, MLPs create extra paperwork and complications when invested through a retirement account because they potentially create unrelated business income (UBI). See the “Tax Consequences” section above for more on this.

Disadvantage #3: Little diversification within the MLP asset class

While MLPs provide significant diversification versus other asset classes, there is little diversification within the MLP structure.

The vast majority of publicly traded MLPs are oil and gas pipeline businesses. There are some exceptions, but in general MLP investors are investing in energy pipelines and not much else.

Because of this, it would be unwise to allocate all or a majority of one’s portfolio to this asset class.

Disadvantage #4: Incentive Distribution Rights (IDRs)

MLP investors are limited partners in the partnership. The MLP form also has a general partner.

The general partner is usually the management and ownership group that controls the MLP, even if they own a very small percentage of the actual MLP.

Incentive Distribution Rights, or IDRs, are used to ‘incentivize’ the general partner to grow the MLP.

IDRs typically allocate greater percentages of cash flows to go to the general partner (and not to the limited partners) as the MLP grows its cash flows.

This reduces the MLPs ability to grow its distributions, putting a handicap on distribution increases.

It should be noted that not all MLPs have IDRs, but the majority do.

Disadvantage #5: Elevated risk of distribution cuts due to high payout ratios

One of the big advantages of investing in MLPs is their high yields. Unfortunately, high yields very often come with high payout ratios.

Most MLPs distribute nearly all of the cash flows they make to unit holders. In general, this is a positive.

However, it creates very little room for error.

The pipeline business is generally stable, but if cash flows decline unexpectedly, there is almost no margin of safety at many MLPs. Even a short-term disturbance in business results can necessitate a reduction in the distribution.

Disadvantage #6: Growth Through Debt & Share Issuances

Since MLPs typically distribute virtually all of their cash flows as distributions, there is very little money left over to actually grow the partnership.

And most MLPs strive to grow both the partnership, and distributions, over time. To do this, the MLP’s management must tap capital markets by either issuing new units or taking on additional debt.

When new units are issued, existing unit holders are diluted; their percentage of ownership in the MLP is reduced.

When new debt is issued, more cash flows must be used to cover interest payments instead of going into the pockets of limited partners through distributions.

If an MLPs management team starts projects with lower returns than the cost of their debt or equity capital, it destroys unit holder value. This is a real risk to consider when investing in MLPs.

The 7 Best MLPs Today

The 7 best MLPs are ranked and analyzed below using expected total returns from the Sure Analysis Research Database. Expected total returns consist of 3 elements:

• Return from change in valuation multiple
• Return from distribution yield
• Return from growth on a per-unit basis

Investors should note that the top MLPs list was not screened on a qualitative assessment of a company’s dividend risk. The focus is expected annual returns over the next five years.

That said, MLPs with current distribution yields below 2% were not considered. This screen makes the list more attractive to income investors.

Continue reading for detailed analysis on each of our top MLPs, ranked according to expected 5-year annual returns.

MLP #7: Enterprise Products Partners LP (EPD)

• 5-year expected annual returns: 10.6%

Enterprise Products Partners was founded in 1968. It is structured as a Master Limited Partnership, or MLP, and operates as an oil and gas storage and transportation company.

Enterprise Products has a large asset base which consists of nearly 50,000 miles of natural gas, natural gas liquids, crude oil, and refined products pipelines.

It also has storage capacity of more than 250 million barrels. These assets collect fees based on volumes of materials transported and stored.

Source: Investor Presentation

Enterprise Products Partners reported strong fourth-quarter 2024 earnings, delivering $1.6 billion in net income, or $0.74 per common unit, representing a 3% increase over the prior year.

Adjusted cash flow from operations rose 4% to $2.3 billion, with the company declaring a quarterly distribution of $0.535 per unit, a 4% year-over-year increase.

Enterprise also continued its capital return strategy, repurchasing 2.1 million common units during the quarter and 7.6 million units for the full year, bringing total buybacks under its program to $1.1 billion.

For the full year, the company posted $9.9 billion in EBITDA, moving 12.9 million barrels of oil equivalent per day.

Click here to download our most recent Sure Analysis report on EPD (preview of page 1 of 3 shown below):

MLP #6: Hess Midstream LP (HESM)

• 5-year expected annual returns: 11.1%

Hess Midstream LP owns and operates midstream assets primarily located in the Bakken and Three Forks Shale plays in North Dakota. It provides oil, gas and water midstream services to Hess and third-party customers in the U.S.

Hess Midstream has long-term commercial contracts, which extend through 2033. Its contracts are 100% fee-based and minimize the exposure of the company to commodity prices.

Source: Investor Presentation

In late January, Hess Midstream reported (1/29/25) financial results for the fourth quarter of fiscal 2024. Throughput volumes grew 15% for gas processing and gas gathering over the prior year’s quarter thanks to higher production and higher gas capture.

As a result, revenue grew 11% and earnings-per-share grew 24%, from $0.55 to $0.68.

Management expects 10% growth of throughput volumes, 11% growth of adjusted EBITDA and at least 5% annual growth of distributions until 2027.

It also expects to reduce leverage ratio (Net Debt to EBITDA) below 2.5x by the end of 2026.

Click here to download our most recent Sure Analysis report on HESM (preview of page 1 of 3 shown below):

MLP #5: AllianceBernstein Holding LP (AB)

• 5-year expected annual returns: 12.3%

AllianceBernstein L.P. is an asset manager with an emphasis on fixed income investments, but offers diversified investment solutions for institutional investors, private wealth clients, and retail investors.

The company traces its roots back to Sanford C. Bernstein & Company, founded in 1967, and to Alliance Capital, founded in 1971.

AllianceBernstein (AB) delivered a strong performance in Q4, surpassing $800 billion in assets under management (AUM). Fixed income inflows reached $6 billion, driven by robust retail demand, particularly in taxable and tax-exempt strategies.

American Income led taxable fixed income demand, while tax-exempt strategies saw over $3 billion in net inflows, supported by retail municipal separately managed accounts and Bernstein Private Wealth clients.

Private markets AUM grew 11% year-over-year to $68 billion, bolstered by net fundings into alternatives, including CLOs, real estate, and renewable energy.

Click here to download our most recent Sure Analysis report on AB (preview of page 1 of 3 shown below):

MLP #4: Plains All American Pipeline LP (PAA)

• 5-year expected annual returns: 14.0%

Plains All American Pipeline, L.P. is a midstream energy infrastructure provider. The company owns an extensive network of pipeline transportation, terminaling, storage, and gathering assets in key crude oil and natural gas liquids-producing basins at major market hubs in the United States and Canada.

Source: Investor Presentation

On February 7th, 2025, Plains All American posted its Q4 and full-year results for the period ending December 31st, 2024.

For the quarter, revenues came in at $12.4 billion, down 2.3% compared to last year. Adjusted EBITDA from crude oil increased by 1% year-over-year, primarily due to higher tariff volumes on its pipelines, tariff escalations and contributions from acquisitions.

Adjusted EBITDA from NGL declined 9% year-over-year results primarily due to lower weighted average frac spreads in the fourth quarter of 2024.

Click here to download our most recent Sure Analysis report on PAA (preview of page 1 of 3 shown below):

MLP #3: Delek Logistics Partners LP (DLK)

• 5-year expected annual returns: 15.2%

Delek Logistics Partners, LP is a publicly traded master limited partnership (MLP) headquartered in Brentwood, Tennessee.

Established in 2012 by Delek US Holdings, Inc. (NYSE: DK), Delek Logistics owns and operates a network of midstream energy infrastructure assets.

These assets include approximately 850 miles of crude oil and refined product transportation pipelines and a 700-mile crude oil gathering system, primarily located in the southeastern United States and west Texas.

The company’s operations are integral to Delek US’s refining activities, particularly supporting refineries in Tyler, Texas, and El Dorado, Arkansas.

Delek Logistics provides services such as gathering, transporting, and storing crude oil, as well as marketing, distributing, and storing refined products for both Delek US and third-party customers.

On February 25, 2025, Delek Logistics Partners (DKL) reported its financial results for the fourth quarter of 2024. The company achieved an adjusted EBITDA of approximately $107.2 million, an increase from $100.9 million in the same period of the previous year.

Distributable cash flow was $69.5 million, with a coverage ratio of approximately 1.2 times. The Gathering and Processing segment saw an adjusted EBITDA of $66 million, up from $53.3 million in Q4 2023, primarily due to higher throughput from Permian Basin assets and contributions from the H2O Midstream acquisition.

Click here to download our most recent Sure Analysis report on DKL (preview of page 1 of 3 shown below):

MLP #2: Brookfield Energy Partners LP (BEP)

• 5-year expected annual returns: 16.3%

Brookfield Renewable Partners L.P. operates one of the world’s largest portfolios of publicly traded renewable power
assets. Its portfolio consists of about 33,000 megawatts of capacity in North America, South America, Europe, and Asia.

Brookfield Renewable Partners is one of four publicly traded listed partnerships that are operated by Brookfield Asset Management (BAM). The others are Brookfield Infrastructure Partners (BIP) and Brookfield Business Partners (BBU).

Source: Investor Presentation

In late January, BEP reported (1/31/25) results for the fourth quarter of 2024. Its funds from operations (FFO) per unit grew 21%, from $0.38 to $0.46, thanks to development and acquisition of assets and strong pricing.

BEP is resilient to high inflation, as about 70% of its contracts are indexed to inflation and most of its costs are fixed.

The company invested an almost record $1.8 billion in all major decarbonization assets in 2024 and it is one of the largest publicly-traded renewable power platforms.

Click here to download our most recent Sure Analysis report on Brookfield Renewable Partners (preview of page 1 of 3 shown below):

MLP #1: Brookfield Infrastructure Partners LP (BIP)

• 5-year expected annual returns: 17.8%

Brookfield Infrastructure Partners L.P. is one of the largest global owners and operators of infrastructure networks, which includes operations in sectors such as energy, water, freight, passengers, and data.

Brookfield Infrastructure Partners is one of four publicly-traded listed partnerships that is operated by Brookfield Asset Management (BAM).

BIP has delivered 8% compound annual distribution growth over the past 10 years.

Source: Investor Presentation

BIP reported resilient results for Q4 2024 on 01/30/25. The diversified utility reported funds from operations of $646 million, up 3.9% year over year. FFO per unit was $0.82, up 3.8%.

For the full year, FFO per unit was $3.12, up 5.8% from the previous year. Normalized for the impact of foreign exchange, the FFOPU growth would have been 10%, which better reflects the business’s operational strength.

For the year, it achieved its target of $2 billion capital recycling proceeds. It also deployed +$1.1 billion across its backlog of organic growth projects and three tuck-in acquisitions, which should help contribute to growth. It also added ~$1.8 billion of new projects to its capital backlog.

Click here to download our most recent Sure Analysis report on Brookfield Infrastructure Partners (preview of page 1 of 3 shown below):

MLP ETFs, ETNs, & Mutual Funds

There are 3 primary ways to invest in MLPs:

1. By investing in units of individual publicly traded MLPs
2. By investing in a MLP ETF or mutual fund
3. By investing in a MLP ETN

Note: ETN stands for ‘exchange traded note’

The difference between investing directly in a company (normal stock investing) versus investing in a mutual fund or ETF is very clear. It is simply investing in one security versus a group of securities.

ETNs are different. Unlike mutual funds or ETFs, ETNs don’t actually own any underlying shares or units of real businesses.

Instead, ETNs are financial instruments backed by the financial institution (typically a large bank) that issued them. They perfectly track the value of an index. The disadvantage to ETNs is that they expose investors to the possibility of a total loss if the backing institution were to go bankrupt.

The advantage to investing in a MLP ETN is that distribution income is tracked, but paid via a 1099. This eliminates the tax disadvantages of MLPs (no K-1s, UBTI, etc.). This unique feature may appeal to investors who don’t want to hassle with a more complicated tax situation. The J.P. Morgan Alerian MLP ETN makes a good choice in this case.

Purchasing individual securities is preferable for many, as it allows investors to concentrate on their best ideas. But ETFs have their place as well, especially for investors looking for diversification benefits.

Final Thoughts

Master Limited Partnerships are a misunderstood asset class. They offer diversification, tax-advantaged and tax-deferred income, high yields, and have historically generated excellent total returns.

You can download your free copy of all MLPs by clicking on the link below:

 

The asset class is likely under-appreciated because of its more complicated tax status.

MLPs are generally attractive for income investors, due to their high yields.

As always, investors need to conduct their own due diligence regarding the unique tax effects and risk factors before purchasing MLPs.

The MLPs on this list could be a good place to find long-term buying opportunities among the beaten-down MLPs.

Additionally, MLPs are not the only way to find high levels of income. The following lists contain many more stocks that regularly pay rising dividends.

• The Dividend Aristocrats List: 69 stocks in the S&P 500 Index with 25+ years of consecutive dividend increases.
• The Dividend Kings List is even more exclusive than the Dividend Aristocrats. It is comprised of 54 stocks with 50+ years of consecutive dividend increases.
• The High Dividend Stocks List: stocks that appeal to investors interested in the highest yields of 5% or more.
• The Monthly Dividend Stocks List: stocks that pay dividends every month, for 12 dividend payments per year.

Updated on March 17th, 2025 by Bob Ciura

The appeal of growth stocks is that they have the potential for huge returns. Consider the massive rally by Tesla, Inc. (TSLA); in the past five years, the stock has generated total returns over 500%.

That’s a lifetime of returns for some investors; Tesla has done this in a relatively short period of time.

The downside of growth stocks is that volatility can work both ways. Also, growth stocks can generate strong returns but also carry the burden of high expectations due to their sky-high valuations.

Right now, Tesla does not pay a dividend to shareholders. As a result, we believe income investors looking for lower volatility should consider high-quality dividend growth stocks.

The Dividend Aristocrats are a group of 69 stocks in the S&P 500 Index with 25+ consecutive years of dividend growth.

You can download an Excel spreadsheet of all 69 Dividend Aristocrats (with metrics that matter, such as dividend yield and P/E ratios) by clicking the link below:

 

Over time, any company – even Tesla – could make the decision to start paying dividends to shareholders if it becomes sufficiently profitable.

In the past decade, other technology companies, such as Apple, Inc. (AAPL) and Cisco Systems (CSCO), have initiated quarterly dividends.

These were once rapidly growing stocks that matured, and Tesla could follow the same way one day.

However, the ability of a company to pay a dividend depends on its business model, growth prospects, and financial position.

Even with Tesla’s huge run-up in share price, whether a company can pay a dividend depends on the underlying fundamentals.

While many growth stocks have made the transition to dividend stocks in recent years, it is doubtful that Tesla will join the ranks of dividend-paying stocks any time soon.

Business Overview

Tesla was founded in 2003 by Martin Eberhard and Marc Tarpenning. The company started out as a fledgling electric car maker, but has grown at an extremely high rate in the past several years.

Tesla’s current market capitalization is above $800 billion, making it a mega-cap stock.

Amazingly, Tesla’s current market capitalization is more than nine times the combined market caps of auto industry peers Ford Motor (F) and General Motors (GM).

Tesla has a growing lineup of different models and price points and is looking into expanding that lineup further to become a full-line automaker.

Since going public in 2010 at a split-adjusted price of $1.13 per share, Tesla has produced almost unbelievable returns for shareholders in hopes of massive future growth, as well as tremendous growth that has already been achieved.

Since then, it has grown into the leader in electric vehicles and business operations in renewable energy. Tesla produced about $97.69 billion in revenue in 2024.

In January, the company reported fourth-quarter revenue of $25.71 billion, which missed analyst estimates by $1.42 billion. Adjusted earnings-per-share of $0.73 missed estimates by $0.04 per share.

Total revenue increased 2% year-over-year for the fourth quarter, while adjusted EPS rose 3% year-over-year. Gross margin of 16.3% contracted by 138 basis points from the same quarter the previous year.

For 2024, revenue increased 1% while adjusted EPS declined 22% from 2023 levels.

Growth Prospects

Tesla’s primary growth catalyst is to expand sales of its core product line, and generate growth from new vehicles. The company’s S/X platform, which gave it the first bout of solid growth, but Tesla is now focused on ramping up its 3/Y platform.

Indeed, the 3/Y platform accounted for ~95% of all deliveries last quarter.

In addition, Tesla is continuing to develop new models, with a pickup truck, a semi-truck, and even a cheaper, more attainable model than the 3.

The company has begun delivering its semi-truck as production of that new vehicle begins to ramp up. It will be some time before that’s a meaningful source of revenue, but it’s a totally new product line that could boost revenue growth.

Tesla is also ramping up vehicle production. It now operates “Gigafactories” in Nevada, New York, Texas, Germany, and China, with more to come to support rising demand.

Tesla’s competitive advantage stems mainly from its best-in-class software and other technologies, including full self-driving mode.

Source: Investor Update

Tesla’s revenue growth has been very strong in the recent past. It grew revenue at an annual rate of 25% in the four-year period from 2020-2024.

That level of growth is difficult to find, which is why Tesla’s shares have performed so well.

Whether Tesla can continue to maintain its high growth rate is another question.

Such a strong growth rate bodes well for the company’s future potential. Some investors may view the guidance of Tesla as too aggressive, but we note that electric vehicle sales are growing at a high rate.

Electric vehicles are the clear path forward for automobiles, and Tesla is the leader in the space.

In addition, more than any other automaker, Tesla has delivered outstanding growth year after year. With an expanding product line, we believe the growth outlook for the company is bright.

Will Tesla Pay A Dividend?

Tesla has experienced rapid growth of shipment volumes and revenue in the past several years. But ultimately, a company’s ability to pay dividends to shareholders also requires sustained earnings growth.

While Tesla has been the epitome of a growth stock through its top-line growth and huge share price gains, its profitability is still small in relation to its market cap. TSLA stock is currently trading at more than 130 times its expected 2025 EPS of $2.56.

Without reaching consistent profitability, a company cannot pay dividends to its shareholders.

Tesla lost money since it became publicly traded back in 2010, up until 2020. It goes without saying that a money-losing company needs to raise capital to continue to fund operations.

To that end, Tesla has sold shares and issued debt to cover losses and fund expansion in recent years, both of which make paying a dividend even more difficult.

However, since 2020, Tesla has rapidly expanded its profitability and produced just over $7 billion in GAAP net income in 2024. The company also generates positive free cash flow, making it easier to service its debt obligations and avoid future dilutive share issuances.

Furthermore, the company does not pay any net interest expense, as its interest income exceeds its interest expense.

We see the improvement in profitability and free cash flow, as well as the improved balance sheet, as supportive of the company’s ability to eventually pay a dividend.

However, Tesla is still very much in high-growth mode, and we expect any dividend that may be paid to be many years away. In other words, it is much more profitable for Tesla to reinvest its earnings in its business than to distribute it to shareholders.

Even if Tesla decided to initiate a dividend, it would likely be very low.

For instance, if Tesla were to distribute 30% of its expected 2025 EPS in the form of dividends (a standard payout ratio for growth stocks that pay dividends), the stock would only yield ~0.2%.

Such a yield will be immaterial for the shareholders, but the dividend would deprive the company of cash that could be utilized for higher-return growth projects.

Tesla’s Stock Dividend

Tesla’s CEO, Elon Musk, said in early 2022, that he wants Tesla to “increase in the number of authorized shares of common stock … in order to enable a stock split of the Company’s common stock in the form of a stock dividend.”

Essentially, a stock dividend is where a company splits its stock, and the impact on shareholders is that the company’s value doesn’t change, but the share price is lower because there are more outstanding shares.

Indeed, Tesla implemented a 3-for-1 split on its stock, which came into force on August 25th, 2022. As a result, its outstanding share count rose from 1.155 billion to 3.465 billion post-stock dividends, and the stock price adjusted from about $900 before the split to about $300.

A stock dividend is not necessarily a material event for shareholders because their relative stake in the company remains the same; they have more shares at a lower price.

However, investors tend to view stock dividends and splits as bullish events; thus, stock dividends can trigger rallies in the share price.

Final Thoughts

Tesla is one of the premier growth stocks in the stock market. Shareholders who had the foresight to buy Tesla in its early years have been rewarded with enormous returns through a soaring share price.

However, investors looking for dividends and safety over the long run should probably continue to take a pass on Tesla stock. The company seems committed to using all the cash flow at its disposal to improve its operations’ profitability and invest in growth initiatives.

While there is always a possibility that Tesla’s massive share price rally could regain steam, it is also possible that the stock could fall. Investors should remember that volatility can work both ways.

More defensive investors, such as retirees, who are primarily concerned with protecting principal and dividend income, should instead focus on high-quality dividend growth stocks, such as the Dividend Aristocrats.

It is unlikely that Tesla will ever pay a dividend, or at least not for many years.

If you are interested in finding more high-quality dividend growth stocks suitable for long-term investment, the following Sure Dividend databases will be useful:

The major domestic stock market indices are another solid resource for finding investment ideas. Sure Dividend compiles the following stock market databases and updates them monthly:

Novo Nordisk (NVO) shares rose Monday as the company said it would present new data on the ability of semaglutide, the active ingredient in its weight-loss drugs Ozempic and Wegovy, to lower heart risks.

The Danish drug developer is slated to take part in the American College of Cardiology Scientific Session and Expo, which runs March 29 to 31. Its presentations “will provide new information about semaglutide medicines to reduce cardiovascular risk,” focusing on conditions including type 2 diabetes, obesity, peripheral arterial disease, and chronic kidney disease. 

Shares of Novo Nordisk were up more than 3% in intraday trading Monday, recovering some of the stock’s losses last week following disappointing results from a phase 3 trial of its in-development weight loss drug CagriSema. Novo reported the average weight loss among patients taking the drug was 15.7% of their body weight after 68 weeks, whereas the drugmaker had reportedly been aiming for 25%. 

Despite Monday’s gains, shares of Novo Nordisk are down about 7% for the year so far, and have lost 40% of their value in the past 12 months.

Chinese tech giant Baidu (BIDU) said it has launched two artificial intelligence (AI) models, including the ERNIE X1, which it claims delivers the same performance as DeepSeek R1 “at only half the price.”

Baidu said in a statement Sunday that it had released ERNIE 4.5—its native multimodal foundation model—and ERNIE X1, the “deep-thinking reasoning model with multimodal capabilities” that the company says rivals DeepSeek’s super-efficient open-source AI model. Both models, the Chinese company said, are free for individual users of its chatbot.

ERNIE X1, Baidu said, “possesses enhanced capabilities in understanding, planning, reflection, and evolution.” The deep-thinking reasoning model, Baidu said, excels in areas including dialogue, logical reasoning and complex calculations.

DeepSeek threw markets in disarray earlier this year when the Chinese startup released its own open-source AI model that performed as well as OpenAI’s ChatGPT and were built at a fraction of the cost using less advanced chips. 

Baidu’s U.S.-listed shares are up around 1% in premarket trading Monday and have lost almost 10% of their value in the 12 months through Friday.

Gold (XAUUSD) is set to remain in the spotlight to start the week after setting a new record high Friday above the closely watched $3,000/oz level.

The precious metal received a boost last week as investors flocked to the safe-haven asset amid concerns that the Trump administration’s unpredictable tariff policies could slow economic growth and accelerate inflation.

Gold gained 2.6% last week and has jumped 14% since the start of the year as of Friday’s close. By comparison, the S&P 500 stock index has fallen about 8% from its record high set less than four weeks ago amid the political and economic uncertainty.

Below, we take a closer look at gold’s chart and apply technical analysis to point out crucial price levels that investors may be watching.

Pennant Pattern Breakout

Gold consolidated within a two-week pennant before breaking out above the pattern’s top trendline last Thursday, signaling a continuation of the commodity’s longer-term uptrend.

Moreover, the relative strength index (RSI) confirms bullish price momentum with a reading above 50, though a push this week into overbought territory could increase the likelihood of near-term profit-taking.

Let’s turn to gold’s chart to forecast how a continuation move may play out and also identify several crucial support levels worth monitoring during potential pullbacks.

Bars Pattern Analysis

To forecast how a continuation move higher in the commodity might look, investors can use bars pattern analysis, a technique that analyzes prior trends to make future price projections.

When applying the analysis to gold’s chart, we take the price bars comprising the asset’s uptrend from August to October last year and overlay them from last Thursday’s breakout point. This forecasts an upside target of around $3,365 an ounce, around 13% above Friday’s closing price. 

The prior trending move, which commenced following a breakout from an earlier pennant pattern on the chart, played out over 57 trading days, indicating a similar move higher could last until early June this year if price action rhymes.

Crucial Support Levels to Monitor

Profit-taking in the commodity could see gold’s price initially revisit the $2,833 level. This area on the chart may provide support near the pennant pattern’s lower trendline and the upward sloping 50-day moving average.

The next lower level to monitor sits around $2,790. A pullback to this location could be met with buying interest from investors seeking entry points near the yellow metal’s prominent late-October swing high.

Finally, a deeper retracement could lead to a retest of lower support at the $2,721 level. This region, positioned about 9% below the commodity’s Friday close, may attract bids near two closely aligned peaks that formed on the chart in November and December last year.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

A Federal Reserve interest-rate decision, comments from Fed Chair Jerome Powell, and the Fed’s “dot plot” interest-rate projections will likely be in the spotlight this week, with retail sales data also due for release as businesses brace for the impact of tariffs.

Nvidia (NVDA) CEO Jensen Huang will deliver the keynote address at the company’s annual GTC conference on Tuesday, amid increasing focus on demand for the company’s chips to support artificial intelligence (AI). Nvidia partner Micron Technology (MU) is set to report earnings, along with Nike (NKE), Accenture (ACN), shipping giant FedEx (FDX), Tesla competitor Xpeng (XPEV), and others.

Monday, March 17

• U.S. retail sales (February)
• Empire State Manufacturing Survey (March)
• Business inventories (January)
• Homebuilder confidence (March)
• Science Applications International Corp. (SAIC), Harrow (HROW), Getty Images (GETY), and Altus Power (AMPS) are scheduled to report earnings

Tuesday, March 18

• Housing starts (February)
• Building permits (February)
• Import/export price index (February)
• Industrial production/capacity utilization (February)
• Federal Open Market Committee (FOMC) meeting begins
• Adobe Summit keynote address
• Nvidia GTC conference keynote featuring CEO Jensen Huang
• Tencent Music (TME), XPeng, and HealthEquity (HQY) are scheduled to report earnings

Wednesday, March 19

• FOMC interest-rate decision
• Fed Chair Jerome Powell’s press conference
• General Mills (GIS), Ollie’s Bargain Outlet (OLLI), and Five Below (FIVE) are scheduled to report earnings

Thursday, March 20

• Initial jobless claims (Week ending March 15)
• Philadelphia Fed manufacturing survey (March)
• Existing home sales (February)
• U.S. leading economic indicators (February)
• PDD Holdings (PDD), Accenture, Nike, Micron Technology, FedEx, Lennar (LEN), and Darden Restaurants (DRI) are scheduled to report earnings

Friday, March 21

• First day for comments from Fed officials following meeting blackout period
• Carnival (CCL) and Nio (NIO) are scheduled to report earnings 

Fed Interest-Rate Decision, Powell Remarks, ‘Dot Plot’ Projections, Retail Sales Data in Spotlight

Investors expect the Federal Reserve to keep interest rates unchanged when it concludes its two-day meeting this Wednesday. It would be the second consecutive meeting where the  Federal Open Market Committee (FOMC) kept rates unchanged after it reduced interest rates by a full percentage point over the final three meetings of 2024. According to the CME Group’s FedWatch tool, market participants have priced in a near certainty that the FOMC will keep rates at its current levels of 4.25% to 4.5%. 

The Fed’s report will also include its quarterly economic projections, including the closely followed “dot plot” that lays out the expected path of interest rates. After the decision, Federal Reserve Chair Jerome Powell is scheduled to answer media questions on interest rates and economic policies, which could have an impact on markets. 

On Monday, February retail sales data arrives as worries over consumer resiliency grow after spending declined sharply in January and consumer confidence waned over tariff fears. Several reports of housing data are on tap for this week as real estate professionals begin to look toward the spring selling season to thaw a frigid housing market that has suffered under high prices and limited inventory. 

The homebuilder confidence report on Monday comes as tariffs on steel and aluminum threaten to raise construction costs, while housing starts data on Tuesday will give some indication on the pace of building activity in February. The Thursday report on existing home sales will show if homebuying continued its slow pace last month. 

Nvidia Kicks Off GTC Event, With Nike, FedEx, Micron, and More Set To Report Earnings

Nvidia CEO Jensen Huang will deliver remarks this week at the company’s annual conference for artificial intelligence (AI) developers, coming as the chipmaker faces market pressure amid a tech stock sell-off.  Huang is scheduled to deliver the keynote address at 1 p.m. ET Tuesday at Nvidia’s GPU Technology Conference, commonly known as GTC, with his remarks coming as the chipmaker faces challenges from Chinese AI technology like DeepSeek.

Investors also will be watching the Adobe Summit this week for updates on AI technology. Nvidia partner Micron Technology is set to report earnings Thursday, after the memory chip maker lowered its revenue projections below analyst estimates as the company cited a weak PC replacement cycle and slower demand for its auto and industrial sector products. 

Also Thursday, Nike is scheduled to deliver its quarterly results after the athletic wear maker reported better-than-expected results in new CEO Elliott Hill’s first quarter as head of the global fashion giant.

FedEx’s scheduled report for Thursday arrives after the shipping company laid out plans late last year to spin off its freight business into a separate public company. In its most recent earnings report, FedEx lowered its full-year outlook to project flat year-over-year revenue growth as the company anticipated weaker demand from consumers.

Several reports from restaurants and retailers also could provide a window into the health of the consumer amid worries about a spending slowdown after January’s retail sales data declined. Discount retailers Ollie’s Bargain Outlet and Five Below are scheduled to release earnings on Wednesday, while Olive Garden parent Darden Restaurants is expected to report on Thursday. Cereal maker General Mills’ report scheduled for Wednesday could also speak to consumer trends. 

Nike (NKE) is scheduled to report earnings for the third quarter of fiscal 2025 after the closing bell on Thursday, with analysts more bullish than bearish on the apparel maker’s stock.

Half of the 18 analysts tracked by Visible Alpha rate Nike stock as a “buy,” with seven “hold” and two “sell” ratings. Their average price target of near $82 would represent a premium of about 14% from Friday’s close.

Nike is expected to report $11.02 billion in revenue for the quarter, down from $12.43 billion the same time a year ago. Earnings per share (EPS) is expected to decline year-over-year to 28 cents.

Second Report Under New CEO Amid Turnaround Effort

Thursday’s report will mark Nike’s second under new CEO Elliott Hill, who took over the top job in October. In the second quarter, Nike’s results topped estimates, and Hill laid out his vision for improving sales. A number of analysts soon lowered their price targets, however, warning Nike’s turnaround could take longer than expected.

Morgan Stanley analysts said recently they see room for “slight outperformance” in third-quarter EPS and projections for the fourth quarter. However, they still “prefer to stay on the sidelines” on the stock, considering an uncertain growth trajectory amid the company’s strategic revamp.

Nike has increased its marketing and product efforts for women in recent months. The company announced a collaboration with Kim Kardashian’s SKIMS for a new line of products, and aired a Super Bowl commercial highlighting prominent female athletes.

Nike shares have lost about 30% of their value over the past 12 months, closing the week just under $72.

Home builders made a small dent in the number of houses needed to meet demand, but the U.S. housing market supply remains short by millions of homes.

The U.S. housing market needs as many as 3.8 million more homes to meet the demands of homebuyers in 2024, according to data from Realtor.com, extending the trend of limited home inventory that has put pressure on home affordability.

It’s the first year since 2016 that home construction outpaced new household formation, showing that builders are beginning to catch up to the ongoing housing shortage. However, Realtor.com economists Hannah Jones and Danielle Hale estimated it would take more than seven years for builders to construct enough homes to close the gap between demand at 2024’s rate.

“We’re still years away from a normal, healthy housing situation,” said Robert Frick, corporate economist at Navy Federal Credit Union 

Zoning Rules Create Challenges for Builders to Meet Demand

There are several factors that have led to the housing supply falling short.

Following the 2008 financial crisis that was spurred by a plunge in the housing market, homebuyer demand dropped, leaving builders to construct fewer houses, Frick said.  Now that housing demand is rising, builders face new obstacles, including local zoning rules that can discourage the development of more affordable housing options. 

One frequent policy target is single-family zoning, which covers about 75% of U.S. residential land but can often prohibit the construction of multifamily units or other more affordable options.

Some economists oppose exclusive single-family zoning, arguing that builders will construct more affordable housing if permitted. Some proposals include allowing the construction of accessory dwelling units on properties in single-family zoning areas or including duplexes or smaller apartment buildings in zoning rules.

However, other researchers say making these zoning changes may not lead to more affordable outcomes. The Boston-based Pioneer Institute found that while some zoning changes in Massachusetts led to more affordable housing options, the effects could affect long-term, broad-based affordability.

“Except in Boston and Cambridge, most of these policies have produced a paltry amount of affordable housing,” said Andrew Mikula, a Pioneer Institute researcher. “It’s extremely difficult to find a scalable way to align the math behind real estate development with programmatic mandates for affordable housing.”

Gaining residency and moving to a new country can be the dream of a lifetime and you can do just that in Golden Visa programs available in countries around the world. It won’t be cheap, however.

Golden Visa programs require a significant economic investment into the country where you’ll be living, but they can be a great way to live abroad if you can afford it.

What Is a Golden Visa?

A Golden Visa allows you to gain residency in a country after making a large investment in the country’s economy. The amount of the investment varies by country.

Golden Visa investment options include real estate, business development, a bank deposit, government bonds, and investment funds.

Many Golden Visa programs include family members so you’re free to include them on your application.

What Countries Have Golden Visas?

More than 100 countries around the globe offer Golden Visa programs and more than 60% of EU member countries have active programs. Countries with popular Golden Visa programs include Greece, Portugal, Italy, Malta, Canada, the United Kingdom, and Australia.

How Much Do Golden Visas Cost?

The price of an investment into a Golden Visa program varies by country. Portugal’s Golden Visa program comes with a price tag as high as $500,000 Euros, Italy and Greece require investments of 250,000 Euros in their Golden Visa programs.

President Donald Trump announced a $5 million Golden Visa program for the United States in February 2025, called a Gold Card.

How Do I Apply for a Golden Visa?

If you want to apply for a Golden Visa, you must first decide on an investment in the country where you’re looking to gain residency. Will you buy real estate, make a business investment, or purchase government bonds?

You’ll also have to provide several documents, including a passport, health insurance, proof of your investment, and proof that you can support yourself financially. You’ll have to go through a series of background checks.

How long do you have to wait after submitting your Golden Visa application? You’ll receive a response within six months or less from most programs. Some applications are processed as quickly as a couple of months.

Not every country is swift with managing Golden Visa applications, however. Wait time for applicants to Portugal stretches to about two years.

The Bottom Line

An international retirement may be within your reach if you qualify for a Golden Visa and receive residency in the country where you’d like to live. You’ll have to spend a good deal of money, however. Golden Visas require making investments into the country that can range from hundreds of thousands of dollars to millions depending on the country you choose.

The investment can be real estate, government bonds, a bank deposit, or investment funds. A Golden Visa program may be just the way to gain residency in another country if this is something you can financially handle.

FedEx (FDX) is set to report fiscal third-quarter results after the closing bell Thursday, and analysts are mostly bullish on the shipping giant’s stock.

Of the 15 analysts who follow FedEx stock and are tracked by Visible Alpha, 12 call it a “buy,” two a “hold,” and one a “sell.” They have an average price target of $318.60 on the stock, more than 31% higher than Friday’s closing level just above $241.

Analysts expect adjusted earnings per share (EPS) to have risen 20% from a year ago to $4.64 and revenue to have edged 1% higher to $21.97 billion. Revenue declined year-over-year in eight of the previous nine quarters, with both FedEx and shipping rival UPS (UPS) experiencing diminishing demand after the pandemic.

Morgan Stanley Says FedEx Likely Had ‘Solid Peak Season’

Morgan Stanley analysts, who have an “underweight” rating and $200 price target on the stock, wrote this month that they believe FedEx had a “solid peak season but no major acceleration in underlying demand/macro trends.”

The analysts said they “see headwinds from an overall compressed peak season,” along with one more month of unwinding its U.S. Postal Service partnership. They also noted the likelihood that FedEx’s DRIVE program—which the company said is expected to create “permanent cost reductions” of $2.2 billion—would be “not as helpful as expected” in the third quarter.

Last quarter, the company missed estimates and said it planned to spin off its FedEx Freight segment into a standalone public company over the next 18 months. Citi analysts had said such a move could “unlock value.”

FedEx shares, which are down 5% over the past 12 months, closed last week at their lowest level in more than a year.