Enbridge (ENB.TO)

Loves it. They have two companies that have existing projects that are cash flowing and they can sell them to embark on new projects.

Very solid energy infrastructure company. Have paid and raised their dividend for the last 47-48 years. Reporting earnings today which are very much in line. Valuation is quite high. Prefers companies that can grow their dividends and cash flow from a smaller base so would prefer Keyera (KEY-T) or Pembina (PPL-T).

Which pipeline company would you pick for a long-term hold? All his clients own TransCanada Corp (TRP-T) and some also own Enbridge (ENB-T). Enbridge has been the better performer in recent years. TransCanada has been hurt by the uncertainty over the Keystone XL. Because of its other projects and its got investments in the electricity business, TransCanada is a good long-term hold. Both of them are worth continuing to hold.

Has very good visibility in terms of earnings and cash flow growth. Have also indicated they will be growing their dividend at a faster pace than earnings growth. Very good pipeline and backlog of projects in place to grow earnings and cash flow.

Likes it here. Guaranteed 8-10% earnings growth and dividend should increase every year. It is viewed as interest sensitive, so that will eat into it by 1-3% a year.

Chart shows a nice run up into early 2013 followed by a corrective period and it held its level of around $41. In a really good space and has the potential to break out. He has a $60 target.

Great company. More recently he has preferred the smaller pipelines. This is getting some traction on Northern Gateway but it is far from certain that it will go ahead. They are more vulnerable because of their low dividend yield to an interest-rate increase than some of the others. You won’t go far wrong by holding this, but if you have made a profit, he would recommend lightening your position a little, and perhaps buying some other pipelines in order to diversify the risk.

Likes but doesn’t know if he would add to his holdings at this price and at this time. Have long-term growth prospects. Should be able to grow its dividend by 10%+. Have just cut guidance a little for 2014. Feels this is just a project timing issue. It will be fine over time. A higher multiple stock and will get hurt when interest rates go up.

Pipeline industry has a very bright future in North America, with all the production that is growing in the US and the Western part of Canada but this is not a super attractive stock. Has done really well, but it’s big and earnings are not going to multiply. Dividend is decent, but not great. If you are going to hold it for a long time, you are probably fine. Better opportunities elsewhere if you want dividends. It may be held back a little bit by US taper talks. Smaller plays that are more nimble could include Keyera (KEY-T) or AltaGas (ALA-T).

Preferred F. 4%. Has had some soft performance over the last couple of months, but there are $7.2 billion preferred shares that are most likely going to get called, in the next 12 months. That represents 13% of the overall preferred share market, and more importantly, over 20% of the rate reset preferred shares that are outstanding. As these get taken out, they have to find a home and he thinks this is one that is going to get a lot of capital going to it.

Right now the politics of everything in terms of new capacity is getting very strained. His view is that long-term, the story is attractive, but if there are any announcements of delays or problems, the stock could be weathering some downside.

Chart shows some support at around $43.50. Really good assets. Thinks the potential is really good. Good risk/reward.

The yield of 2.75% is low but they have tremendously strong committed capital projects over the next 5 years, something like $30 billion.

(Market Call Minute.) Fairly valued and nothing too exciting, but he would Hold.

(Top Pick Oct 4/12, Up 9.81%) Does not give you very many buying opportunities. Stock continues to chug along. Good entry point. They can talk comfortably at investor days about what they are doing for the next 5 to 10 years because they have long term contracts. They have a simple model and do their business incredible well. Can grow dividend 10% a year. They can grow into their price. You are buying it on sale.