Enbridge (ENB.TO)

This is energy, but it is the pipelines, which he thinks is here to stay. They’ve shown themselves as able to grow and pay a reasonable dividend. A good basic stock to hold in your portfolio. Not a huge amount of risk. 4.6% dividend yield.

You buy this for the dividend and the growth in the dividend. It’s one you stick in your portfolio and look at it once every year or two. 4.6% dividend yield.

A pipeline stock, and they did an acquisition that increases their presence in the US on the natural gas side. She felt their quarter was fine. Pipeline companies don’t build a pipeline unless they have very long-term commitments. The company feels that they can increase their dividend 10%-12% annually to 2024.

They have a lot of financing for their huge pipeline in years to come, which sometimes provides an opportunity. They reported last week and had a very small miss on the quarter. They have said they are going to grow the dividend 8%-10% in each of the next 5 years. Dividend yield of 4%. (Analysts’ price target is $63.)

TRP-T vs. PPL-T. PPL-T has been expensive historically because management is worthy of it and so he would go for this one. He owns EMB-T because of the advantage that whoever you have to pay bills to you should own them. They have growing dividends at 8-10%. He likes the premium management of PPL-T and it is worthy of an increased multiple.

One of his favourites. He sees a very positive growth rate in dividends over the next 6-7 years, and probably going out as they develop additional infrastructure. A classic example of a Canadian utility going into the US and making a major acquisition. That will be the basis of further growth in the future. He would be comfortable buying this here.

Enbridge (ENB-T) or Enbridge Income Fund (ENF-T) for dividend income? This one is the company that is building the pipeline and the energy services, etc. Once that is completed, it is largely sold to the Enbridge Income Fund.

This has a nice dividend yield. It just made a huge acquisition of Spectra in the US. They claim to have lots of runway and that dividend growth is going to be 10% per annum. They are going to rebuild the main pipeline that runs from Alberta into Duluth. It is probably a very solid company. If they can deliver the 10% dividend increase, you’ll be fine.

Enbridge (ENB-T), Toronto Dominion (TD-T) or split the money in half? This is a tough question, as he owns both. Both stocks have their merit. TD over the long run probably has the better story because of their large US franchise. However, Enbridge acquired Spectra. He would split the money and buy them both.

This gives you a little bit of a dividend play. With their buyout of Spectra Energy last year. They probably have growth out to the next decade now. One thing you have to be concerned about over the long-term with some of these pipeline companies is the regulatory hurdles and the approval process where they’re probably more of a merger and acquisition play to get their growth. You could probably see another 10% growth.

Preferred Series V. This is a US$ one, but it gets the dividend tax credit. It has had a tremendous run, and he hasn’t sold a share.

He likes the growth outlook and they have pledged to increase their dividend every year. The Canadian economy needs pipelines to be done.

One of those great Canadian businesses that amounts to a monopoly, or a very limited market. This is a wonderful business. They’ve had an incredible track record over the past number of years. They consistently raise their dividend. If it got a little weaker, he would be looking to add to his holdings.

He’s been a big admirer of this. The problem is, it always looks expensive on a valuation basis metric, but on the other hand they have several billions of dollars of projects going forward. He thinks they are going to continue to increase their pipeline. An outstanding dividend company.

He is constructive on energy. Holds this as well as 2 others that are similar, Keyera (KEY-T) and Inter Pipeline (IPL-T), and is more constructive on them than on Enbridge. Enbridge is doing a lot of borrowing and have a fairly high payout ratio. Keyera would be his #1 pick in the space.