Found in IBD's Dividend Leaders screen, Western Midstream Partners (WES) is in the spotlight, boasting a sizzling 9% dividend yield.

Formed in 2019 from a spinoff from Occidental Petroleum (OXY), Western Midstream operates over 14,000 miles of crude oil and natural gas pipelines across the American Midwest. Despite the split, the companies are still completely intertwined, with Occidental controlling operations and owning 49% of Western Midstream.

Oil and gas midstream companies often appear in IBD's Income Investor column due to their stable, fee-based contracts. These contracts enable companies to provide steady distributions without being overly exposed to energy price volatility.

Additionally, the significant capital investment required to build pipeline infrastructure creates high barriers to entry, resulting in limited competition. This often leads to claims that such companies hold a monopoly in the sector.

This environment bodes well for investors. While many high-yielding stocks come with significant caveats, Western Midstream stands out with its impressive 9% annualized yield, far surpassing the S&P 500's average dividend yield of 1.2%.

That high yield should be expected to continue moving forward with the company posting record volumes of gas and oil flow through its Delaware and Powder River basin network last quarter.

New Administration Could Lead To Further Growth

Moving forward, company President and CEO Oscar Brown hinted at potential future expansions or acquisitions.

This strategy aligns with a favorable regulatory outlook, as the incoming Trump administration is expected to ease regulations and environmental standards — key factors that have historically caused delays and increased costs for pipeline expansion projects.

Financially, Western Midstream is in solid shape. The company recently issued $800 million of 5.450% senior notes due in 2034, effectively refinancing its upcoming debt maturities. Additionally, it achieved its trailing 12-month net leverage ratio target of three times last quarter.

Shares of Western Midstream are trading above the 200-day moving average. The stock appears to be forming a double-bottom base with a 41.29 handle buy point. The relative strength line, however, is lagging, its MarketSurge chart shows.

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