The Best Energy Stock to Invest $1,000 in Right Now
Key Points
Enterprise Products Partners offers upside potential and downside protection.
The midstream leader's distribution is also quite attractive.
- 10 stocks we like better than Enterprise Products Partners ›
Military conflicts in the Middle East create tremendous uncertainty. However, they also provide significant catalysts for energy stocks. We're seeing that happen now with the U.S. and Israeli actions in Iran.
What's the best energy stock to invest $1,000 in right now? I think several stand out as great picks. But my favorite is Enterprise Products Partners LP (NYSE: EPD).
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Upside potential, downside protection
Investors have flocked to Enterprise Products Partners in 2026 as oil and gas prices have soared. To be sure, this pipeline stock hasn't been the biggest winner in the energy sector. Shares of oil and gas exploration companies have delivered especially large gains. However, Enterprise's unit price was up 16% year to date as of the market close on March 9, 2026. What I like most about this stock is its solid upside potential while also providing downside protection.
Enterprise Products Partners operates over 50,000 miles of pipeline, as well as other midstream assets, including liquids storage, natural gas processing plants, and fractionators. The demand for U.S. oil and gas typically increases when production in the Middle East is disrupted. That translates to more revenue for Enterprise.
This limited partnership doesn't need geopolitical conflicts to be successful, though. Enterprise Products Partners was already growing due to the rapid buildup of data centers, among other factors.
Importantly, Enterprise Products Partners' fortunes don't rise and fall with commodity prices. The midstream leader has generated consistent cash flow during both good and bad times, including the financial crisis of 2007 through 2009, the oil price collapse of 2015 through 2017, and the COVID-19 pandemic of 2020 through 2022.
Enterprise Products Partners' return on invested capital (ROIC) has been in the double digits every year since 2005, with an average ROIC of 12% over the last 10 years. Roughly 90% of its long-term contracts have escalation provisions that protect against inflation. The LP's balance sheet is also solid, as evidenced by Enterprise's status as the only midstream energy infrastructure company with an A- credit rating.
More things to like about this midstream energy stock
No discussion of Enterprise Products Partners' merits is complete without mentioning the company's juicy distribution. Despite being near its lowest level in five years, Enterprise's distribution yield remains above 5.9%.
Even better, the pipeline operator has increased its distribution for 27 consecutive years. Enterprise Products Partners recently increased its distribution by 2.8%. The LP has ample financial flexibility to fund its distributions while also buying back units.
There's one other thing to add to the list of things to like about this midstream energy stock. Around one-third of Enterprise's common units are owned by its general partner's management and affiliates. That kind of skin in the game among executives is usually a good sign.
Should you buy stock in Enterprise Products Partners right now?
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Keith Speights has positions in Enterprise Products Partners. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.
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