By Robert Hauver
DCP Midstream Partners LP, (DPM), an oil & gas pipeline company, has one of the higher dividend yields in our High Dividend Stocks by Sector tables. It also appears to be undervalued, and has several above-average metrics, when compared to its peers, in our Industry Comparison Table:
| DPM | Oil & Gas Pipeline Industry | |
| P/E | 5.38 | 25.00 |
| PEG | 0.45 | 6.91 |
| EPS GROWTH NEXT 5 YRS. | 12.00% | 4.99% |
| ROA | 10.03% | 4.01% |
| ROE | 52.79% | 7.18% |
| ROI | 12.70% | 4.74% |
| DIVIDEND YIELD | 7.99% | 6.79% |
DPM, which closed at $30.04 Wednesday, recently declared a $.60/share dividend, payable to shareholders of record Feb. 5th, 2010.
DPM also has covered call and put options available with double-digit annualized yields:
COVERED CALL: July 2010 $30.00 call is currently bid at $1.75, a 13% annualized yield. Covered call sellers would also collect $.60/share in dividends, for an additional 4.47% annualized yield.
CASH-SECURED PUT: July 2010 $30.00 put is currently bid at $2.35, a 17.5% annualized yield, (based on a 100% cash reserve).
Disclosure: Author doesn’t own DPM shares.
Disclaimer: This article is written for informational purposes only.