Pembina Pipeline Corp (PPL.TO)

PPL-T vs. ENB-T. He prefers TRP-T or ENF-T. ENF-T yields almost 7% and has higher growth expectations than the parent, ENB-T. It is down at the moment. TRP-T is natural gas weighted and he believes it has a brighter future than oil.

An extremely well-run company. They are working so many projects, plus they just acquired Veresen, which they have to digest. If you are going to play energy, this is an interesting way to play it, because about 70% of it is contract based. They just boosted their dividend again.

Chart shows an old top in 2014 which was violated, and it managed to go higher and higher. If your original buy was based on the 10-day moving average breaking the 21 day, use that as a Sell discipline. If it goes below the 21 day, then you Sell. Other than that, just ride it. Dividend yield of 4.85%.

Just had their quarter recently, and beat by 8%. Their commodity exposed businesses were weak, but should really be good in Q4. Their Veresen assets were performing very well. He is modelling very brisk growth of 18% over the next few years. 60% payout ratio. Likes this name.

They have closed the VSN-T acquisition. It is another leg up in growth. He would love to buy it at $40 to $41 but this is a decent place and stock to own.

Pipelines have been a weird place to be, but this is one of the strong ones. From 2014 to 2016, it had a big downtrend, but was followed by a nice upswing. The trend had a bit of a break a few months back, where the market was wondering if the value had been fully realized. For the next 6 months if we have a pro-growth rally going in other areas, it doesn't mean you are not going to find valuations that are out of whack. Prefers Inter Pipeline (IPL-T), which has been beaten up a little more and has a higher yield. He would like to see this one hold just below the $40 range. Below that, we are actually looking at capital erosion.

One of the local companies in Alberts that gathers oil from the bigger guys. He likes this as well as Inter Pipeline (IPL-T). A utility that’s in a non-political situation in Alberta, and they don’t have to worry about building a pipeline. Good dividend. Has some growth potential.

In the midstream gas space. Recently completed an acquisition of Veresen which has increased their capacity and increased their potential for future growth. Most of the pipelines have come down in the last couple of weeks. Expects there will be growth opportunities over the next few years. Dividend yield of over 5%. (Analysts’ price target is $50.)

He sees their acquisition of Veresen very favorably and thinks that it really extends their base to grow earnings. He would consider taking a closer look, but still thinks none of the pipeline companies are cheap right now.

He does not own pipes right now. This is a good one and if he had to own one it would be in the top group. The risk is simply that the energy markets are not attracting any cash flows. You are fine to collect the dividend of 5.2%.

Closed at $42.91, and he has a model price of $53.25, a 24% premium over the current price. If it got $39.51, it would be interesting. Remember that in the 1^st part of 2016, the stock was basically down to about $27. It’s had a good recovery. Feels that a lot of interest sensitive stocks are meeting a lot of competition as interest rates move higher.

In the infrastructure industry. She likes the Veresen acquisition, located in the Montney region in Alberta and BC, which closed earlier this month. A very low-cost region where producers can make a reasonable return even at these low prices. The company is well positioned to service that area. Veresen also presents more longer-term opportunities, such as Jordan Cove. This is more for the income investor. Dividend yield of 5%, which she expects could be increased. (Analysts’ price target is $50.)

If there is a down day for oil, that is going to be a downer for this, because it is storage and pipelines. The big problem in Alberta is that there is nowhere to send by pipeline, because all the pipelines are being held up. This is one of the better providers for storage and pipelines. Their balance sheet is decent. They’ve been making acquisitions that have been improving their revenues over time. Free cash flow has been stagnant, but then it is basically a quasi utility anyways. Dividend growth is 7% and CapX is up 53%.

He recently purchased more shares, just before the merger was completed. The dividend increases is what is more exciting for him. There was a 12.5% dividend increase this year. A really well run-company, great assets in the Montney and the future is pretty bright.

Inter Pipeline (IPL-T) or Pembina Pipeline (PPL-T)? Local carriers in Alberta, Saskatchewan and BC. They take oil from various oil sands, do some treating, with some storage. They are local utility providers on the pipeline side. Don’t have the political problems of getting through province to province to province. He likes the business they are in. The reason he likes Inter Pipeline is that it yields 7%. This one yields 5%. Either one is a good investment.