Thursday, February 17, 2011

Enbridge (ENB) Dividend Analysis

Enbridge transports and distribute energy in North America through its vast network of pipelines. It's one of the largest Canadian energy distributor publicly traded (since many of the large ones are crown corporations). If it generates energy, Enbridge is usually involved. They operate in the current fields:

  • Gas distribution with 1.9 million customers
  • Oil & Gas transport through its pipelines
  • Storage of oil & gas
  • Renewable energy
  • Alternative energy

Quick Facts

  • Stock Ticker: ENB on both NYSE & TSX
  • Market Cap.: 22.04B$
  • P/E: 22.31
  • EPS: $2.57
  • 5 Year EPS Growth Average: 16.37%
  • Dividend Yield: 3.41%
  • 5 Year Dividend Growth Average: 13.88%
  • ROE: 13.14%
  • 52-Week Low: $46.03
  • 52-Week High: $59.03
  • 52-Week Range: 87.46%
Enbridge had a nice growth this past year. If you combine that with its dividends, it makes for a nice investment.

Enbridge 1 Year Stock Graph

Dividend Growth

How do you like this chart? 13 increases in the past 13 years and an annual average dividend growth of 11% for those 13 years. Unfortunately, it was flat for 10 years prior to that and a little inconsistent with its growth before that. It has, however, paid dividends for 58 years with no drop in dividends. It highlights their commitment to pay dividends.

Enbridge Dividend Growth

Dividend Payout Ratio

Enbridge targets a 60%-70% payout ratio. In the past 10 years, it has done quite well to keep their payout in line with their targets.

Enbridge Dividend Payout Ratio

EPS Growth

The EPS growth is actually nice. Even though it suffered a drop this past year, you can still see a linear growth. ENB has a P/E of 22 which is a little above the sector average of 20 but not too far from the pack.

Enbridge Dividend Payout Ratio

Thoughts

Enbridge is a Canadian Dividend Aristocrats and investor friendly with its healthy dividends. Its business model is recession proof but not incident proof unfortunately. There is always a risk that an incident can cost them money and that translates in a step back for investors. The stability of the business and the healthy dividends make Enbridge a solid 'boring' investment.

Readers: Do you feel Enbridge has a place in your portfolio?

Full Disclosure: At the time of writing I am long ENB.

Disclaimer: The material presented should not be considered a recommendation. You should always do your own research and reach your own conclusion.

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3 comments:

  1. "since many of the large ones are crown corporations"

    Perhaps I having been doing my research, but I can't think of a single pipeline in Canada that is a crown corporation. Pembina, Transcanada, Kinder Morgan (Terasen), Fort Chicago, Interpipeline...

    (I have a big position in ENB and TPP.)

    ReplyDelete
  2. when a common stock can be traded at more than one STOCKmarket I prefer to buy the home market.

    Thus when the currency is up and down it is not always easy to trade

    At the moment in the penny cash SAVING ACCOUNT having australian $ 80

    which american broker has the facility to buy australian stock common

    ReplyDelete
  3. @Anonynous
    I was referring to the energy aspect where Hydro Quebec is really large in Quebec. Hydro One in Ontario is another.

    However, in terms of oil, Enbridge is the largest. I could have been more clear, thanks for pointing it out.

    ReplyDelete

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