Record Earnings, 9.5% Yield, Big Growth In 2018, 10% Below Lowest Price Target

Do you believe in climate change? Either way, a loudly expressed opinion on this subject is sure to raise the temperature in the room at your next cocktail party. The yield is 9.5%, with 1.28x Q4 coverage, and management has raised the payout 10 straight times since its IPO. It reported record revenue, EBITDA and DCF in Q4 '17. Management guided to big growth in 2018, 38%-58% net income, 18%-24% DCF, and it is going to raise the distribution by a minimum of 7.2%. It's now 10% below analysts' lowest price target.

Many of the world's governments, particularly in Europe and the UK, have come down firmly on the side of climate change and have enacted tougher measures for carbon emissions, which has sent major utility companies scrambling for viable alternatives. That's where Enviva Partners LP (EVA) comes in. EVA is the world's largest producer of wood pellets, supplying ~ 14% of global production. It sources its feedstock from the forests of the southeastern US, which happens to be, by far, the cheapest source on the planet for wood pulp.

Source: Seeking Alpha

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