Enbridge Inc. (NYSE:ENB) operates as an energy infrastructure company. The company operates through five segments: Liquids Pipelines, Gas Transmission and Midstream, Gas Distribution and Storage, Renewable Power Generation, and Energy Services. The Liquids Pipelines segment operates pipelines and related terminals to transport various grades of crude oil and other liquid hydrocarbons in Canada and the United States. The Gas Transmission and Midstream segment invests in natural gas pipelines, and gathering and processing facilities in Canada and the United States. The Gas Distribution and Storage segment is involved in natural gas utility operations serving residential, commercial, and industrial customers in Ontario, as well as natural gas distribution and energy transportation activities in Quebec. The Renewable Power Generation segment operates power generating assets, such as wind, solar, geothermal, and waste heat recovery facilities; and transmission assets in North America and Europe. The Energy Services segment provides energy marketing services to refiners, producers, and other customers; and physical commodity marketing and logistical services in Canada and the United States. The company was formerly known as IPL Energy Inc. and changed its name to Enbridge Inc. in October 1998. Enbridge Inc. was founded in 1949 and is headquartered in Calgary, Canada.
Enbridge has a low-risk business model. The company operates pipelines and utility-type assets in North America and Europe that generate steady cash flow backed by long-term contracts and government-regulated rate structures. Overall, 98% of its earnings come from those stable sources, while 80% also feature inflation protections.
Meanwhile, Enbridge pays out a reasonable 60% to 70% of those stable earnings via a dividend that currently yields 6.42%. It also boasts a strong investment-grade balance sheet. That gives it billions of dollars of annual financial flexibility to invest in expansion projects, make acquisitions, and repurchase shares.
- Market Cap: 82.01 billion
- PE Ratio: 19.88
- EPS: 2.03
- Dividend Yield: 6.42%
The company currently has a multi-billion-dollar backlog of expansion projects under construction. They provide it with clear visibility to grow its cash flow at a 5% to 7% annual rate through at least 2024. Meanwhile, it has secured several expansions this year that will come online in the 2025-to-2027-time frame, positioning it to continue growing at a healthy rate for years. That should enable Enbridge to continue growing its dividend, which it has done for the last 27 consecutive years.
Enbridge’s lower-risk business model generates stable cash flow. It also has a conservative financial profile and visible growth prospect. That should enable it to continue growing its earnings and dividends in the future, which should allow it to produce attractive returns for its investors. Therefore, Enbridge is a great option for those seeking safer investments in today’s uncertain market.