Midstream energy CEFs like KYN, NML, SRV, and EMO offer high yields, leverage benefits, and avoid K-1 tax issues, making them attractive for income-oriented investors. ClearBridge Energy Midstream Opportunity Fund — EMO — has shown significant NAV growth, but its market price remains discounted; it's best held in tax-deferred accounts due to its dividend income classification. The energy sector, particularly midstream companies, is set to benefit from rising natural gas demand and pro-oil policies, with strong prospects for continued growth in 2025.
NEW YORK--(BUSINESS WIRE)--Category: Financials.
The energy sector, particularly midstream companies, is set to benefit from Trump's pro-oil and gas policies, boosting fossil fuel investments. Midstream companies like Energy Transfer are experiencing significant growth due to rising natural gas demand from power plants and data centers. Investing in CEFs holding midstream assets offers high yields, leverage benefits, and avoids K-1 tax issues, making them attractive for income-oriented investors.
The ClearBridge Energy Midstream Opportunity Fund is a very popular fund that helps investors get a very high yield without tax problems. The fund boasts a 9.24% yield at the current share price, which is higher than most of its peers. EMO makes no attempt to invest in the "energy transition" or "clean power," which is nice given the economic problems facing that sector.
NEW YORK--(BUSINESS WIRE)--Category: Financials.
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ClearBridge Energy Midstream Opportunity Fund announced a new corporate action consisting of a tender offer for up to 50% of its outstanding shares. The announcement led to a significant rally in EMO shares and the narrowing of the CEF's discount to NAV. Existing shareholders have the potential to gain a 7% synthetic gain from the tender offer, while new investors should view EMO as a dividend yielder rather than a cheap buying opportunity.
ClearBridge Energy Midstream Opportunity Fund specializes in investing in midstream corporations and energy infrastructure companies, providing access to master limited partnerships in tax-advantaged accounts. The fund boasts an 8.60% yield, comparing well to other energy infrastructure funds. The fund's recent performance has been better than the S&P 500 Index, with investors making a significant difference in returns.
Midstream partnerships have long been an excellent investment vehicle for anyone seeking income due to their high yields and general stability. ClearBridge Energy Midstream Opportunity Fund invests in a portfolio of these companies that includes most of the best companies in the industry.
ClearBridge Energy Midstream Opportunity Fund Inc. is an MLP equity closed end fund. The CEF is currently trading with a -14% discount to NAV.