Our recipe for capitalizing on the current slump in energy valuations and MLP prices specifically is simple.

First, resist the temptation to sell solid, profitable midstream businesses poised to benefit from domestic energy production and energy exports over the long run.

Second, increase exposure to downstream niches like refining and tankers, which have not yet received full credit for the fundamental upturns they’re enjoying, and which are returning money to investors at yields comparable to MLPs and in some cases much higher.

Third, be on the lookout for clearance sales in long-term value creators, even if they merely sponsor energy yield vehicles but are not themselves organized as MLPs or, in some cases, if they’re MLPs not involved in energy processing.

Fourth, secure the income stream before worrying about whether that income comes with the tax-deferral advantages that have long been one of MLPs’ main selling points.

We’ve used all of these ingredients in compiling our outperforming portfolio, including this issue’s updated Best Buys list.

It features several leading conventional midstream MLPs, but also a variety of refiners, tanker operators and MLP sponsors with fundamentally strong and significantly undervalued profit streams.

This month’s lone portfolio addition also breaks the MLP mold as the leading developer of alternative energy projects. New Buys explains why SunEdison (NYSE: SUNE) has lost investors’ trust and more than half its share price in recent weeks and why it’s quite likely to regain it over time.

One drawback of staying focused on the MLP sector’s long-term value proposition is that it makes it challenging to understand why so many have been so eager to bail out of these names both in the very recent past and over the last year. This month’s In Focus addresses the bear case and the causes of the recent selling to help subscribers weigh these against our frequent advice to lean into the wind.

Portfolio Update returns with a focus on the recent results of the new best buys, since quite a few of them are recent portfolio additions that may be unfamiliar to subscribers. We’ll catch up on the rest of the portfolio next month. The results I have reviewed to date strongly suggest that any near-term business risks have been more than fully discounted.

Until the market comes around to this view, we’ll continue to practice patience and target the most outstanding opportunities caused by short-term dislocations.