Daily Stock Pick: Enviva Partners

A portfolio of stocks I've been building since September 3, 2019, named Volio, will eventually hold 52 dividend dogs. Volio is the fifth portfolio I've built (at a one dividend dog per-week pace) since 2014. Five portfolios = V for Volio!

Today I'm reviewing the third of five energy sector stocks primed to join Volio as the third of three representing the sector.  One of the stocks I discuss this week could be the forty-seventh overall Volio selection! Just five more Volio picks to make after this one.

My subject today is a small-cap renewable biomass company named, Enviva Partners LP. Its trading ticker is EVA. This is my first report on Enviva for this Volio portfolio.

Enviva Partners LP is a producer and supplier of Biomass products. The company procures wood fiber and process it into utility-grade wood pellets. It generates its revenue by supplying wood pallets to its primarily European and Japanese utility customers through long term contracts.

Enviva Partners GP, LLC operates as the general partner of the company. Enviva Partners, LP was founded in 2013 and is based in Bethesda, Maryland.

I use three key data points to gauge dividend equities or funds like Enviva Partners LP:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether a company has made, is making, and will make money.

EVA Price

Enviva's price per share closed at $39.14 yesterday. A year ago their price was $30.83. Price rose $8.31 or nearly 27% last year.

Assuming Enviva's stock trades in the range of $20 to $45 this next year, its recent $39.14 price might rise by $0.86 to reach $40.00 by July 22, 2021.

EVA Dividends

Enviva's most recent declared quarterly dividend was $0.68, paid May 30th. That $0.68 Q dividend equates to $2.72 annually for a yield of 6.95% at yesterday's $39.14 share price.

EVA Gains?

Adding the $2.72 annual estimated dividend to my $0.86 optimistic estimate of Enviva Partners LP price upside shows a $3.58 potential gross gain, per share, to be reduced by any costs to trade the shares.

If we put little over $1,000.00 today in Enviva Partners LP we would buy 26 shares of EVA stock.

A $10 broker fee paid half at purchase and half at sale could cost us about $0.38 per share.

Subtract that $0.38 brokerage cost from my estimated $3.58 gross gain per share results in a net gain of $3.20 X 26 shares = $89.60 for a 21% net gain on a $1,017.64 investment.

Thus, Enviva Partners LP shows a possible 8.9% net gain including a 7.51% dividend yield. It could be more, it could be less.

The above speculation is based on past performance and supposition. Only time and money invested will tell if Enviva Partners LP is worth it.

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, ...

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