High-Dividend Stock Yields 11%, Industry Turnaround Picking Up, Analysts Raising Price Targets

fter bottoming around 400, the (US) rig count has increased to over 700 rigs currently, up about 80% from the low point. Commodity prices for both oil and natural gas are significantly higher and have appeared to stabilize at levels that permit economic exploration and production. Energy industry activity, as measured by rig counts in capex spending, is quite encouraging. The capital markets have opened up and the general level of confidence throughout the sector has risen significantly. This stock yields 11.58%, with distributions supported by fee-based contracts. It's benefiting from an industry turnaround - they just reported record Revenues in Q4. Management has paid down more debt recently - the company now has one of the lowest debt loads in its industry. It has a competitive advantage in the most in demand equipment in its industry.

USA Compression Inc. (NYSE:USAC) provides natural gas compression services under term contracts with customers in the oil and gas industry in the United States. It engineers, designs, operates, services and repairs its compression units and maintains related support inventory and equipment. USAC focuses on providing compression services to infrastructure applications primarily in high-volume gathering systems, processing facilities and transportation applications, which call for large horsepower compression units.

Source: Seeking Alpha

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