MPLX is undervalued due to high starting yield (8.5%), strong guided distribution growth (12.5%), and sustainable dividend coverage via growing distributable cash flow per share through 2030.

we have MLX, SPGI, and then we have Mastercard. MPLX has done really, really well. It's up 24.5%. MLX is a somewhat rare addition to my portfolio because it's a very high yielding stock.

In fact, the indicated yield as of right now sitting roughly 7.3%, but when I added it to my portfolio, it was closer to about 8.5%. In fact, if we just jump over to my dividend dashboard, go ahead and cheat and look at my yield on cost on this position, you can see it's sitting at about 8.53%.

So, the recent run up in share price has caused the starting yield to go down. But again, when I added, it was yielding 8.5%.

And not only did I buy MLX with a 8.5% yield, management has been guiding towards around 12.5% distribution growth over the next few years. They've already hiked the dividend by a high amount this year.

The company's not overleveraged. It's trading at a pretty reasonable leverage ratio range. And then most importantly, when we look at these stocks, we want to pay close attention to how much distributable cash flow per share they're generating because essentially that tells us whether or not the dividend is sustainable.

Distributable cash per share is the northstar metric for these MLPS for these mid-stream stocks. It's like looking at free cash flow per share or earnings per share for a traditional stock.

So if this is growing, the intrinsic value is growing. And if it's covering the dividend, then generally speaking, that dividend is sustainable. So you can see in 2026 the dividend should be very well covered and it's projected to continue to be that way through the year 2030.

So that's the thesis for MPLX in short. And you can see anytime you buy a stock with a 8.5% yield that's growing distributions at double digits as long as those distributions are truly sustainable.

All else being equal, it's probably an undervalued stock. And that's exactly what happened to MLX.

and then MPLX a big dividend payment almost $200