Pembina Pipeline Corp (PPL.TO)

Their LNG project is in the US, which is a better bet, though things are improving in Canada. Oregon doesn’t have the same regulatory hurdles as Canada. Smart operators. Likes the company. Wishes he’d gone with them in the past instead of IPL. Management’s done an excellent job. Reasonable dividend.

(A Top Pick Oct 25/17, Up 18%) At these levels it is starting to get a little bit expensive. The risk/reward is getting to the long side of switching out to maybe ENB-T. It is a good dividend, good company, so he is okay continuing to hold it.

It's done well, though it sells at a premium against its peers at 23x earnings--which always scared him off. But pipeline stocks are highly levered. It's well-run.

It is breaking out. It looks very positive after a consolidation.

Not running out of growth pipelines, and that is unique to this company. Still finding projects on the west coast of Canada. Great yield, plus the growth kicker. Big beneficiary of any LNG projects on the west coast. Like it short-term for the yield, and long-term for the growth with coal being replaced by gas. Yield is 5%. (Analysts’ price target is $51.22.)

Always thought this was pricey at 50x forward earnings. He's wary. We're in a skittish market and this may have more downside. Don't rush into the current peak price. Also, pipelines take a long time to build.

Pembina versus Inter Pipeline. PPL-T technically has a lid on the price chart, where it is now bouncing down away from. Until it breaks above $45 he would think it goes sideways. One has a better trend formation – albeit lower highs and lower lows. He would not be interested in buying this either.

His only concern with Interpipeline are rising interest rates that will pressure these pipeline companies. He'd rather buy en energy producer like Pembina which has a comparable yield, but higher dividend growth.

It's been contained in a trading range for the past two years. It's a so-so chart, not bad. Worth holding for the 5.3% dividend yield.

Utilities are more volatile in a rising rate environment. He has TRP-T and ENB-T plus IPL-T, but there is nothing wrong with this one. It could be vulnerable if rates rose sharply.

It is a big company with better growth opportunities. Every time he compares to Inter Pipe, he can’t convince himself to move to Pembina. The fear of higher interest rates is hurting this sector as a whole.

The challenge with the pipes is that they are sensitive to rates and are caught up in transpiration issues.

A great name that is being ignored. They have a really good balance sheet. They don’t have to go to the market to fund growth. They are not exposed to large projects so don’t have the risks. He models an 11% growth rate. It is too cheap. He thinks the asset is being miss-priced.

They have been the best out of the group. The company is doing well. You might get a bit of a better entry point over the next six months but it is one he would look to put away.

Veresen assets are helping. Accretive acquisition in the Duvernay in January. 5% dividend for a name with good visibility. (Analysts’ price target is $50.27)