The books are nearly closed on 2011. The MLP Profits model portfolios are poised post a third consecutive year of solid total returns, despite the volatility that roiled the US equity market.

Even with concerns about global economic growth and the ongoing EU sovereign-debt crisis, our favorite MLPs continued to benefit a historically low cost of capital in the debt market and robust demand for new equity issues. Meanwhile, many of our top picks are investing this capital in growth projects that provide much needed midstream infrastructure in the nation’s prolific shale oil and gas plays. Capacity constraints in these regions have enabled MLPs to secure favorable, long-term deals that generate reliable cash flow and support distribution growth.

However, volatility in the stock market meant that business success didn’t necessarily translate into price appreciation for some of our picks. At the same time, safety-minded investors flocked to MLPs that garner a large percentage of their cash flow from fee-earning assets.

In this issue, we look back that year that was a reevaluate our Portfolio holdings and strategy.

The Stories

There’s one downside to the strong performance of our Conservative Portfolio and the megadeals of 2011: Takeover candidates now trade at a premium, and four of the six Portfolio holdings trade above our buy targets. See Conservative Strength.

All our Growth and Aggressive Portfolio holdings that finished the year below are buy targets continued to execute operationally and post solid distribution growth. See Benign Growth.

Our MLP Rating system sums up the key elements for MLPs’ financial health on a scale of zero to 4. A zero indicates an MLP meets none of our holdings, a “4” indicates an MLP meets all of them. Here’s a brief description of each criterion. See Under the Hood.

The Stocks

Sunoco Logistics Partners LP (NYSE: SXL)–Take Some Profits, Buy < 32 in Conservative Portfolio
DCP Midstream Partners LP (NYSE: DPM)–Take Some Profits, Buy < 40 in Growth Portfolio
Targa Natural Resources Partners LP (NYSE: NGLS)–Take Some Profits, Buy < 35 in Growth Portfolio
Legacy Reserves LP (NSDQ: LGCY)–Buy < 32 in Aggressive Portfolio
Linn Energy LLC (NSDQ: LINE)–Buy < 40 in Aggressive Portfolio
Vanguard Natural Resources LLC (NYSE: VNR)–Buy < 30 in Aggressive Portfolio
Penn Virginia Resource Partners LP (NYSE: PVR)–Buy < 29 in Aggressive Portfolio
Teekay LNG Partners LP (NYSE: TGP)–Buy < 41 in Aggresive Portfolio
Navios Maritime Partners LP (NYSE: NMM)–Buy < 20 in Aggressive Portfolio
Energy Transfer Partners LP (NYSE: ETP)–Buy < 50 in Growth Portfolio
Regency Energy Partners LP (NYSE: RGP)–Buy 29 in Aggressive Portfolio
Inergy LP (NYSE: NRGY)–Hold in Growth Portfolio