Enbridge (ENB.TO)

It traded at a 5 year high yesterday. They are raising the dividend 12% through 2020. Yield and growth. It has pulled back to a nice entry point. (Analysts’ target: $62.00).

This is an attractive entry point. They acquired Spectra. Enbridge is typically more of a crude oil pipeline. Spectra is natural gas, and is all US, so it expanded their geographic scope as well as diversifying their commodity base. The company indicated that they feel they can grow their dividend 10%-12% annually to 2024.

Enbridge (ENB-T) or Enbridge Income Fund (ENF-T)? He likes this company. Sometimes, they sell things to the Enbridge Income Fund, and he prefers to own Enbridge itself. Made a big huge acquisition in the US and ended up with a lot of debt. Expects they won’t see their growth happening in Canada any more. Thinks they will be able to continue to pay down the debt. Dividend yield of 4.7%.

Over time, this has probably been one of the best performing Canadian stocks over 50 years. They’ve had some difficult times, particularly with respect to their potential investments. To him, it is a great way to own the equivalent of what might be a railroad. No new pipelines are going to be built. They have the infrastructure in place. A good time to be picking this up. Dividend yield of 4.6%.

One of the few energy companies he would own. Pipeline infrastructure gets compensated, not on the price of oil, but on cost return metrics. This company has a whole plethora of new projects coming on, and they talk about dividend growth of up to 10% per annum over the next few years. Not cheap, but a decent hold, and you should make a little bit of money over the long-term.

It was a great performer and then earlier this year it was a poor performer. He does not average up or down.

Has owned some of this for a long time, and the only reason he hasn’t sold it is that he doesn’t want to pay the tax. The company has been treading water and is down about 7% year to date. It has been pursuing a growth by acquisition strategy, and doing it by raising its dividend to attract investors, and selling stock to pay for the dividend. They have been selling stock endlessly for 10 years now. They’ve exhausted the investment community. Very, very complex balance sheet.

(Market Call Minute.)

This has been the stalwart for dividend owners, and he wouldn’t have any trouble owning it. Thinks the world is going to become fully electric, so you want to own companies that have exposure to electric utilities. You should have one or 2 of these types of names in your portfolio, especially if you are looking for income.

PPL-T vs. ENB-T. In the energy space these have been stronger performers overproducers. With interest rates moving higher it will be a mixed blessing for pipelines. Their dividend does not look as attractive, but as interest rates go up so are their allowed rate of return through the regulator. Look for which one has the most consistent track record of dividend increases and the best record of dividend coverage. If it is the same stock for each factor, go with it and if not go with the latter factor.

Basically a long-term hold. PE multiple is always high. It is not to be compared with the oil/gas producers, high risk and cyclical. You simply hold this for the long-term. Dividend yield of 4.8%.

This is a fine company. Feels the dividend is safe. They acquired Spectra, a natural gas transition company in the US. Based on the projects they have and the backlog the sector has, they can increase their dividend 10%-12% through 2024. In a rising rate environment, it is very important to find companies that have an attractive yield. Dividend yield of 4.66%.

Canada’s largest pipeline company. The crown jewels would be the main line and Lakehead pipelines, a pipeline that carries about two thirds of all the oil produced in this country. They also own downstream assets that distributes natural gas. Just completed a $42 billion transformational acquisition of Spectra Energy in the US, making them the 4^th largest company in Canada. It also broadens their asset base and positions them strategically in a growing production base. Dividend yield of 4.8%. (Analysts’ price target is $62.)

Is the dividend safe? All these utilities tend to carry more debt, while the businesses are very stable. Their balance sheet is fine and the 4.6% dividend is not a problem. This falls into a category of being a small Short for him, because valuation is not cheap.

An RESP for a 1-year-old? He would recommend this. A great kind of name for a 20-year investment, who will need the money in 18 years when they go off to school. This company pays a wonderful dividend of 4.7%.