Stockchase Opinions

Rick Stuchberry Enbridge ENB-T HOLD Sep 05, 2018

In the short term, it will be difficult to see grow. He would prefer to hold Pembina, with a little smaller profile. Investors will be attracted to this space for the income.

$45.650

Stock price when the opinion was issued

oil gas pipelines
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BUY

Likes all the pipelines. Energy infrastructure spending is a huge area for Canada over the next number of years. This name is a prime beneficiary. Good dividend yield. 

COMMENT
Write a short-term covered call?

The thing about this one is that the call premiums can often be weighed down by dividends. So if you're going to sell calls on something with a higher dividend, and it's a lower-volatility name, you can expect the option premium to be small. Not something he'd do, as it has a pretty good yield already of 6-7%.

STRONG BUY

Stable dividend, 30 years of consecutive dividend growth. Solid revenue pipeline, which is regulated. Earnings growth in mid-single range. Pretty healthy outlook for the stock. Price of oil has somewhat stabilized. Yield is 6%.

If you don't need the income right now, sign up for the DRIP.

BUY ON WEAKNESS

The kind of stock everyone can own. Dollar-cost average in, and hold long term. Consistent, reliable, pseudo-utility though it falls under energy. Not high growth or a high ROC, as it's very capital intensive. Dividend chart and payout ratio look fantastic.

BUY
ENB vs. BMO

Banks look to be extended, but pipelines seem to be reaccelerating (TRP, ENB). Given his view about a potential correction coming soon, doesn't mind rotating a bit out of BMO and putting some into ENB. Likes the breakout, and thinks it's more defensive-related, not energy-related.

If you look at the Commitment of Traders data (published every Friday), commercial hedgers (considered the "smart money") have been hedging crude oil less (which means they've been going longer). Something interesting is happening there.

BUY
Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research

ENB has done well, and offers a solid secure dividend. We would remain quite comfortable buying it in the low $64 range. 
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BUY

You should take note of the litigation issue and remember that the news and media can move a stock. However she doesn't see anything being detrimental over the longer term. The natural gas side is picking up although the oil side is under a bit of pressure. She thinks Enbridge can adapt. The dividend is over 6%.

BUY

Technical analysts love to give fancy names to chart patterns ;)  The 5-year for this name is showing a cup and handle -- with that rounded bottom, perhaps a little pullback, and then a breakout and consolidation. Also a nice swing trade. Now testing the breakout point, and successfully so. Looks good.

HOLD
ENB vs. PPL

Likes and owns both. If she had to buy one today, it would be PPL. ENB has already seen growth. PPL lagged for a lot of this year, flat to negative, up until last week with Alberta data centre announcement. Pembina has a strong management and track record.

HOLD

He's been cautious on the pipes. The pipeline ETF in the US is hitting RSI new lows for the year, as are a lot of the pipes in Canada (including the best-performing one, ENB). Price chart looks fine, relative strength is weak. Fine for the yield.

People looking at long-life, more-utility-type assets are focusing more on electrical power generation. In that camp, you might look at CPX.