MLPs Worth Pursuing: Plains All American, Magellan Midstream

The MLP asset class is attractive because investors are getting quality assets with healthy yields at relatively inexpensive prices, said Jay Hatfield, President of Infrastructure Capital Advisors. Hatfield added that his InfraCap MLP ETF (AMZA) sells calls and uses leverage to increase its yield. He is bullish on Plains All American Pipeline LP (PAA), saying the company is well diversified and has significant storage assets. Hatfield is also positive on Magellan Midstream Partners LP (MMP), saying the company has a high return on invested capital. Finally, Hatfield said MLPs are good investments in a rising rate environment because they are more correlated to stocks and commodity prices than interest rates.