If he was just interested in income, he'd pick IPL. But he's interested in total return, so he owns Enbridge. Both good companies, but concern with IPL was no capital appreciation. Enbridge has continued to grow dividend at 10%. IPL has a huge capital project on the go, which diverts cash from dividend increases and share buybacks. Enbridge getting Line 3 replacement in place would derisk the story. The dividend would then creep down to 5%, which implies a stock price north of $60. (Analysts’ price target is $56.00)
If he was just interested in income, he'd pick IPL. But he's interested in total return, so he owns Enbridge. Both good companies, but concern with IPL was no capital appreciation. Enbridge has continued to grow dividend at 10%. IPL has a huge capital project on the go, which diverts cash from dividend increases and share buybacks. Enbridge getting Line 3 replacement in place would derisk the story. The dividend would then creep down to 5%, which implies a stock price north of $60. (Analysts’ price target is $56.00)
ENB vs IPL? A classic case, where he prefers ENB (due to its growth profile). Getting a higher yield on IPL will be overshadowed by a higher capital return on ENB. He owns ENB.
ENB vs. Keyera for dividend safety They pay the same yield. FMV of Keyera is 14% higher and Enbridge is 13.4% than current stock prices. Keyera has resistance at $36 (sell at this point). The big difference is, the balance sheet of Enbridge is slipping away, while Keyera's is rising, so he mildly prefers Keyera. Both have limited upside.
ENB vs. Keyera for dividend safety They pay the same yield. FMV of Keyera is 14% higher and Enbridge is 13.4% than current stock prices. Keyera has resistance at $36 (sell at this point). The big difference is, the balance sheet of Enbridge is slipping away, while Keyera's is rising, so he mildly prefers Keyera. Both have limited upside.
