Stockchase InsightsEnbridgeENB.TOBUYFeb 08, 2023

Liquid pipelines business, with some gas transmission in midstream (that's where the upside is). Provides 20% of US gas consumption, and 25% of feed gas for LNG exports. Those 2 industries seeing tremendous growth. Rising global demand for LNG, and NA will supply that with ENB perfectly positioned. Likes it here, he'd buy.

Overhang: Line 5 mishap with negligible environmental impact, but Michigan's trying to shut it down. Odds of that are pretty low. ENB will have to spend $$ on this and pay fines.

Trump would be unwise to ban Canadian oil. It pays a 6% yield and holds great assets around the world, including the Permian Basin.

Probably this one. Spending likely to be stronger in terms of infrastructure spend on pipelines. Valuation's more attractive than it's been for a while. He worries a bit about Line 5 in Michigan, with permits and pushback (will ultimately get done).

He bought some on the financing deal. With all the infrastructure spending, there have to be more pipeline expenditures going forward. Somewhat more defensive.

It is a quality name but he would take TC Energy with a $20 billion backlog, or Pembina, over Enbridge for the long term. Enbridge has been weak so you could buy it as a tactical move. It is a little out of favour.

He owns many pipelines which have tons of value. It's a defensive sector. Canadian pipelines and nat gas are overlooked. Is a good trade.

It is another defensive stock with over a 5% yield and has growth at these levels. Blackstone is knocking at the door and could buy some assets from them in the US. He likes the new CEO appointment.
On defensive stocks in general he looks for companies with good cash flow to manage with which they can make counter-cyclical acquisitions, raise dividends and survive market downturns.       Buy 11  Hold 9  Sell 2

Is good for income. He just bought it at $70 due to rising interest rates. Yields 5.3%. Any sell-off is attractive.

Excellent, very-well-managed company. Great financial discipline. Nice dividend of 5.5%, tax-advantaged over bonds. Expected EBITDA growth is ~5%. Payout ratio ~65%, not much room for dividend increases (~2-3% a year). Highly capital-intensive, fair amount of debt. Cost of debt going up makes it hard for valuation to go higher.

More attractive are companies with dividends that may be lower, but growing rapidly.

We talked about this last week, saying that a bit more of a pullback was probably in the cards.

Maintaining the dividend is not a challenge, and it will continue to grow. Under pressure because of the assumption that peace will come to the Strait of Hormuz. But the space ran up in the first place due to the conflict. Just look at the chart. Big capex program, growth in various businesses. 

Blue-chip company, ballast for your portfolio. Buy, put it away for the dividend. His firm has owned for ~27 years, and they've been happy campers reaping the income.

Move down is probably due to the quick move in long bond yields across NA. When interest rates start to go up, and you consider the risk-free rate of owning bonds versus owning a riskier equity, dividend stocks fall. Not a lot of organic growth or high ROIC.

He expects the chart to decline like it did in 2022-2024 where there's a re-valuation and it will go sideways. So, don't buy at the top at $80, but looks good now at $70 for the dividend. It's not a growth, but income story. This could decline further, so buy only a tranche now.

Pays a 4.5% dividend that will grow. They have the largest crude oil pipeline network in North America. They own nat gas operations in the U.S. They have a backlog that can grow their cash flow by 5%. Will benefit from Ottawa's infrastructure growth in western Canada.

Yield is a bit lower than some of the others. Results were largely in line, market reaction may just be due to whipsawing from Iran war. As well, not immediately proceeding with an expansion. Still a very good name, though he owns PPL for its size and growth.

Any of Canada's 4 major pipelines are good investments for the long term.

Started buying this in 2019 and added during dips. Is steady and pays a decent dividend, but is not that cheap nor expensive. Not a bargain, but a good place to park cash at a 4.5% dividend with modest growth.