If you are an income-focused investor, you’ll be attracted to Energy Transfer<\/strong>‘s (NYSE: ET)<\/span> lofty 7.3% distribution yield. Add in a plan for 3% to 5% annual distribution growth, and you get to roughly 10%, which is the return that most investors expect from stocks over time. Here are some more reasons to be attracted to Energy Transfer and one that may still keep you away.<\/p>\n The core story with Energy Transfer is that it operates a large North American midstream business. It basically helps to move oil and natural gas around the world. The master limited partnership<\/a> (MLP) uses a toll taker approach, charging fees for the use of its energy infrastructure assets.<\/p>\n Where to invest $1,000 right now?<\/strong> Our analyst team just revealed what they believe are the 10 best stocks<\/strong> to buy right now, when you join Stock Advisor.\u00a0See the stocks \u00bb<\/strong><\/span><\/a><\/em><\/p>\n That generally leads to reliable cash flows throughout the energy cycle. The volume of energy moving through its system is more important than the prices of oil and natural gas. Given the importance of energy to modern society, volumes tend to be pretty robust most of the time. Through the first nine months of 2025, Energy Transfer’s distributable cash flow covered its distribution by a very strong 1.8x.<\/p>\n Looking forward, Energy Transfer has $5 billion in capital spending plans for 2026 to keep its business growing. Looking further out, management has projects that extend to 2029. That’s what backs its plan for 3% to 5% annual distribution growth.<\/p>\n There’s one small wrinkle that may worry more conservative income investors. Energy Transfer cut its distribution by 50% in 2020 during the energy downturn that accompanied the coronavirus pandemic. Management explained that the purpose of the cut was to strengthen the balance sheet<\/a>. That’s a good thing, of course. However, if you had been counting on those distributions to cover living expenses, you would have been very unhappy and might have sold the MLP.<\/p>\n To be fair, leverage has been reduced, and the distribution is growing again. In fact, it is higher than it was prior to the cut. Still, the decision to reduce the distribution may weigh heavily on investors who need their income to pay for living expenses.<\/p>\n There are good reasons to like Energy Transfer, and there is a good reason to look elsewhere. In fact, the midstream sector is filled with high-yielders, and some, like Enterprise Products Partners<\/strong> and Enbridge<\/strong>, have decades of dividend growth behind them. You may have to accept lower yields, but the trade-off may be what lets you sleep well at night during the next energy downturn.<\/p>\n<\/p><\/div>\n Before you buy stock in Energy Transfer, consider this:<\/p>\n The Motley Fool Stock Advisor<\/em> analyst team just identified what they believe are the\u00a010 best stocks<\/a><\/strong> for investors to buy now\u2026 and Energy Transfer wasn\u2019t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.<\/p>\n Consider when Netflix<\/strong> made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation,\u00a0you\u2019d have $439,362<\/strong>!* Or when Nvidia<\/strong> made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you\u2019d have $1,164,984<\/strong>!*<\/p>\n Now, it\u2019s worth noting\u00a0Stock Advisor\u2019s<\/em> total average return is 918% \u2014 a market-crushing outperformance compared to 196% for the S&P 500.\u00a0Don’t miss the latest top 10 list, available with\u00a0Stock Advisor<\/em>, and join an investing community built by individual investors for individual investors.<\/span><\/strong><\/span><\/p>\n See the 10 stocks \u00bb<\/strong><\/a><\/p>\n *Stock Advisor returns as of February 10, 2026. <\/em><\/p>\n Reuben Gregg Brewer<\/a> has positions in Enbridge. The Motley Fool has positions in and recommends Enbridge. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy<\/a>.<\/em><\/p>\n<\/div>\n<\/div>