After what was a somewhat dismal 2017 for the energy master limited partnerships (MLPs), 2018 could bring some good cheer for holders of the shares. The just completed Republican tax reform plan is reasonably positive for the sector, and with MLP yield spreads to the 10-year Treasury wider than usual, the potential for solid total return gains is in play. Plus, it’s important to note that with the S&P 500 up almost 20%, compared to the MLP Alerian index that is down right at 14% year to date, there is value to buy in a pricey market.

In a new research report, analysts at RBC see oil demand growing in 2018 to 1.5 million barrels per day. That combined with continue OPEC production cuts should actually produce moderate inventory draws. That is a distinct change from months of bloated inventories that kept prices in check.

The RBC team has eight preferred MLP picks currently, and here we picked the five with the largest total return upside potential. All are rated Outperform at RBC.

Archrock Partners

Shares of this off-the-radar company could have the highest total return potential of those in the RBC universe. Archrock Partners L.P. (NASDAQ: APLP) is a compression services MLP.

The company’s contract operations services primarily include designing, sourcing, owning, installing, operating, servicing, repairing and maintaining equipment to provide natural gas compression services to its customers. It serves companies engaged in various aspects of the oil and natural gas industry, including natural gas producers, processors, gatherers, transporters and storage providers. The company markets its services through sales and field service personnel.

The analysts note that the company carries a distribution coverage of a solid 1.8 times and is focused on lowering debt before it continues distribution growth.

Shareholders are paid an outstanding 9.67% distribution. The RBC price objective for the stock is $13, but the Wall Street consensus target is $16.42. The shares traded early Tuesday at $11.75.

Energy Transfer Partners

This company merged with Sunoco Logistics Partners last year. Energy Transfer Partners L.P. (NYSE: ETP) engages in the natural gas midstream and intrastate transportation and storage businesses in the United States.

The company’s Intrastate Transportation and Storage segment transports natural gas from various natural gas producing areas, and through ET fuel system and HPL system. It owns and operates 7,500 miles of natural gas transportation pipelines and three natural gas storage facilities in Texas. Its Interstate Transportation and Storage segment provides natural gas transportation and storage services; owns and operates approximately 12,300 miles of interstate natural gas pipeline; and has interests in various natural gas pipelines.

The Midstream segment gathers, compresses, treats, blends, processes and markets natural gas. It owns and operates 35,000 miles of in service natural gas, 31 natural gas processing plants, 21 natural gas treating facilities and four natural gas conditioning facilities.

The analysts noted this in the report:

The company has under-performed on growth project challenges and equity overhang. We believe these headwinds have mostly subsided and Energy Transfer is on path for cash flow growth as growth projects including DAPL, Rover, ME2/2X and Revolution come online and/or continue to ramp. As cash flow increases, we expect natural de-leveraging and a path to simplification.

Energy Transfer unitholders receive a massive 12.8% distribution. RBC has a $22 price target. The consensus target is $24.70, and shares traded at $17.70 Tuesday morning.

Spectra Energy Partners

This company has posted very solid earnings and looks to continue raising distributions. Spectra Energy Partners L.P. (NYSE: SEP) is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas, natural gas liquids (NGLs) and crude oil. These assets include more than 17,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage and approximately 4.8 million barrels of crude oil storage.

The stock is also investment grade rated BBB, and RBC cites the company’s long term, take-or-pay contracts and a robust project backlog with high credit quality counterparties. This offers investors a company with very visible cash flow growth with minimal direct or indirect commodity price exposure. That is almost the ideal situation with the pricing still highly volatile.

Spectra Energy investors receive a 7.02% distribution. The $53 RBC price target compares with the $48.88 consensus target. The shares were last seen at $41.60.

Targa Resources

This top energy MLP has had a string of positives lately. Targa Resources Corp (NYSE: TRGP) is a leading provider of midstream services and is one of the largest independent midstream energy companies in North America. Targa owns, operates, acquires and develops a diversified portfolio of complementary midstream energy assets.

The company is primarily engaged in the business of gathering, compressing, treating, processing and selling natural gas; storing, fractionating, treating, transporting and selling NGLs and NGL products, including services to liquefied petroleum gas (LPG) exporters; gathering, storing and terminaling crude oil; storing, terminaling and selling refined petroleum products.

Targa Resources has one of the premier asset positions in the Permian basin. With solid management, a strong balance sheet and attractive exposure to some of the most attractive U.S. energy basins, it is a top pick for 2018 across Wall Street.

RBC loves the company and noted this:

Equity funding needs are addressed for 2017 and we believe current levels represent a good entry point. Most likely takeout candidate in the MLP space, in our view.

Investors are paid a 7.71% distribution. The RBC price objective is a whopping $57. The consensus estimate is $51.67, and shares were trading at $47.35.

Western Gas Partners

This is another defensive play with a great balance sheet and limited commodity price risk. Western Gas Partners L.P. (NYSE: WES) is a growth-oriented MLP formed by Anadarko Petroleum to acquire, own, develop and operate midstream energy assets.

Western Gas Partners has midstream assets located in the Rocky Mountains, the Mid-Continent, north-central Pennsylvania and Texas. The company is engaged in the business of gathering, processing, compressing, treating and transporting natural gas, condensate, natural gas liquids and crude oil for Anadarko, as well as for other producers and customers.

RBC likes the total return prospects:

We believe WES is well positioned to drive above-average distribution growth over the next several years through organic growth opportunities across its liquids-rich areas. Highly visible above-average distribution growth potential coupled with a predominantly fee based/fixed price revenue stream and investment grade balance sheet warrants a premium valuation, in our view.

Shareholders are paid a 7.6% distribution. RBC has set a massive $63 price objective. The consensus price target is $58.71. The shares traded at $47.85.

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All these top stocks are offering investors an outstanding entry point after being clobbered for much of the fall. The OPEC production cut combined with other positive metrics should put a tailwind behind the entire sector in 2018. It’s important to remember that distributions may contain return of capital.

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