This month’s Best Buys include a new Conservative Portfolio Holding and an old favorite from the Growth Holdings.

The first is Boardwalk Pipeline Partners LP (NYSE: BWP), an owner and operator of transportation, storage, gathering and processing infrastructure with a focus on natural gas and related liquids. The second is Teekay LNG Partners LP (NYSE: TGP), which owns and operates a fleet of tankers for carrying energy liquids.

Like most fee-driven energy midstream operators, Boardwalk Pipeline has tacked on some gains since touching bottom in mid-November 2012. Unlike our Conservative Holdings, however, it still yields upward of 7 percent, the result of no distribution increases since April 2012.

Before that Boardwalk Pipeline had increased its payout for 24 consecutive quarters since its inception in late 2005.

And the longer the lack of dividend growth, the greater skepticism has appeared to grow about the MLP’s prospects. Of the 15 analysts covering the stock, only two rate it a “buy” against nine “holds” and four “sells.”

Insiders, on the other hand, have remained steady buyers, boosting their holdings by 5 percent over the past six months. Meanwhile, the company has continued to grow its business, recently inking a joint venture with Williams Companies Inc (NYSE: WMB) to develop a pipeline system for natural gas liquids (NGLs).

The proposed system will initially carry 200,000 barrels a day from the Marcellus and Utica shales in Ohio, West Virginia and Pennsylvania to the Gulf Coast. But there’s potential to double capacity to meet additional market demand that can be added when new contracts are secured.

Boardwalk Pipeline’s revenue rose 8 percent during the fourth quarter of 2012 from the year before, primarily thanks to new assets added in Louisiana. And projects funded by some USD147.1 million in growth capital projects are set to fuel 2013 results.

Distributable cash flow rose 2.1 percent, good enough for a 1.3-to-1 coverage ratio but apparently not enough to satisfy expectations of some, who have flown for higher dividend growth MLPs.

Judging from commentary during management’s fourth-quarter conference call, we may not see a resumption of dividend growth in the near future.

First, there are the capital needs of expanding the company’s system and following through on growth projects, which are currently projected at USD250 million. But there’s also likelihood that the company will lose some USD40 million in revenue from contract expirations, which will offset at least some of the benefit of new development.

Low natural gas and NGLs prices may keep pressure on returns from some of Boardwalk Pipeline’s assets over the next year. That should diminish as the ability to get these products to global markets grows, with NGLs’ expansion happening a lot sooner than natural gas itself.

And management has been focused on cost efficiencies and refinancing debt at low rates. There’s also been some benefit from gas to power generation projects.

That being said, there are major spending projects in the works, including the Williams Companies NGLs venture. And until we see first-quarter earnings–expected on or about April 30–we won’t have a firm idea of what demands on cash flow will be or how much to expect.

The offset is a yield that’s currently twice that of some of our Conservative Holdings from a company with good contacts that’s in basically the same fee-for-service type of business. Boardwalk Pipeline Partners is a buy up to USD30 for those who don’t already own it.

Teekay LNG is the rare shipping company that’s still growing and covering its distribution. But that hasn’t kept its unit price from being held down with the rest of the floundering tanker sector.

As we pointed out in the March Portfolio Update, Teekay’s distributable cash flow soared 22 percent in the fourth quarter of 2011, as it continued to add capacity and lock in customers. The biggest boost came from the acquisition of a 52 percent interest in six liquefied natural gas (LNG) tankers in February 2012.

The company has a very favorable relationship with its parent and general partner, which allows for frequent drop downs. Teekay Corp (NYSE: TK) owns 36.29 percent of the units. And it’s also going through with some LNG new-builds on its own.

Debt needs are relatively light for such a capital-intensive business, as the company has no maturities until 2015. That should put Teekay LNG Partners in great shape to take advantage of the proliferation of new liquefaction projects around the world, including the surge in western Canada and Australia.

Most of this new business won’t come through until 2015, at the earliest. But Teekay LNG’s business model of locking in cash flow via long-term contracts should add to its financial strength.

The Exmar joint venture to ship liquefied petroleum gas (LPG) should start paying off even more in 2014, when four of a scheduled eight new-builds enter operation. The rest will come on line between April 2015 and June 2016, in time for many of the liquefaction projects to come on stream.

Ultimately Teekay LNG’s success will depend on continue to match dividends to expected demand growth. Near-term challenges to distribution growth include certain costs with the Exmar deal, a temporary cut in charter rates with two of the Suezmax tankers, a greater-than-anticipated number of dry-docking days and uncertainty with two Suezmaxes now on charter that Teekay LNG plans to sell.

The fourth-quarter distributable cash flow coverage ratio of 1.01-to-1 was below normal, largely due to equity issued for the Exmar deal. But management looks for better going forward, starting with the release of first-quarter results on or about May 17. Well before then we’ll see if the company meets expectations for another distribution increase.