Enterprise Products Partner Shares Jump as Cash Flows Climb

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Enterprise Products Partners, a pipeline company, saw its shares rise after returning to growth in the fourth quarter and projecting accelerated growth through 2027. The company's cash flows and distributable cash flow increased, and it forecasted double-digit growth in both categories in 2027 as new projects come online.

Why it matters

Enterprise Products Partners is a major player in the pipeline industry, and its financial performance and growth outlook are closely watched by investors. The company's ability to maintain its high-yield dividend and generate strong cash flows is important for income-oriented investors.

The details

In Q4, Enterprise's total gross operating profit rose by 4% to $2.74 billion, while its adjusted EBITDA also increased by 4% to $2.71 billion. Distributable cash flow (DCF) rose by 3% to $2.22 billion, while adjusted free cash flow came in at just $1.17 billion. The company currently has a forward yield of 6.4% and has been one of the most consistent high-yield dividend stocks in the sector. Looking ahead, Enterprise forecasted that its adjusted EBITDA and cash flow would grow at the lower end of its 3% to 5% targeted range in 2026, but projected double-digit growth in both categories in 2027 as new projects come online.

• In Q4, Enterprise's total gross operating profit rose by 4% to $2.74 billion.
• In 2025, approximately 82% of Enterprise's gross operating profit came from fee-based activities.
• Enterprise paid a $0.55 per unit quarterly distribution in Q4, which was up 2.8% year over year.

What’s next

The company has lowered its capital expenditure (capex) budget for this year, taking it to a range of $2.5 billion to $2.9 billion from $4.4 billion in 2025. As such, it thinks it has the potential to produce around $1 billion in discretionary free cash flow in 2026, which is its free cash flow after paying out its distributions.