Constructive Outlook for 2022 Midstream Dividends
January 11, 2022 at 16:26 PM EST
The potential for more dividend increases is improving as 2022 is setting up to be another year of strong free cash flow generation complemented by macro and micro tailwinds. Several midstream companies have announced plans to increase their payouts this year or have already declared a higher dividend. Most increases are expected to be modest (i.e., 5% or less), but some companies are expecting more significant growth. Expectations of robust free cash flow generation, improving balance sheets, more normalized yields, and a constructive 2022 midstream outlook contribute to a more conducive backdrop for midstream dividend increases than seen in sometime.