Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

4 Reasons to Buy Enbridge (TSX:ENB) Today

Stock MarketsAug 31, 2021 19:15
Saved. See Saved Items.
This article has already been saved in your Saved Items
4 Reasons to Buy Enbridge (TSX:ENB) Today

Have you invested in Enbridge (TSX:ENB)(NYSE:ENB)? The energy behemoth remains one of the best long-term options on the market for investors. Surprisingly, the reasons why you should buy Enbridge today are not widely known.

Here’s a look at why you should buy Enbridge today.

Reason #1: A reliable business Enbridge is well known predominately for its pipeline business. While the company does have other segments (which we’ll discuss in a bit), the pipeline business remains the core area investors are most versed in.

To put that into context, that pipeline business is huge. Enbridge hauls a quarter of all crude destined to the U.S. market, as well as one-fifth of the natural gas consumed by the U.S. market. In other words, the pipeline business is a lifeline, if not an arterial vein of the entire North American energy market.

That’s not even the best part. Despite what many investors may think, that pipeline business is not based on the volatile price of oil. Specifically, Enbridge hauls crude and gas based on volume and distance and not based on the commodity price.

What this means is that irrespective of which way oil prices move, Enbridge is still generating a recurring and stable revenue stream. This is a great reason to buy Enbridge today, which will only increase in the future.

Reason #2: Solid growth potential The only thing better than a reliable revenue stream that isn’t tied to commodity prices is a growing revenue stream that isn’t tied to commodity prices. Rather than sitting on its laurels, Enbridge continues to invest heavily into growth. This includes upgrading its existing pipeline network as well as building out new pipelines to add to its network.

Perhaps the most well-known growth initiative is the controversial Line 3 project. The on-again, off-again project will considerably boost the capacity to deliver crude to refineries south of the border. Once complete, Line 3 will allow over 750,000 barrels per day of crude to traverse the network, which is nearly double the current capacity.

Apart from Line 3, it’s also worth noting that Enbridge has a project backlog that is valued in the billions. Incredibly, many of those backlog projects aren’t even related to its pipeline business.

Reason #3: The non-pipeline potential While Enbridge is predominately known for its pipeline business, few investors may know about Enbridge’s growing renewable energy business. In recent years, Enbridge has invested significantly towards growing its renewable energy business.

Today, that renewable energy business consists of onshore and offshore wind facilities, as well as solar and geothermal sites. In total, Enbridge’s renewable business has a gross generating capacity of over 5,000 MW. This makes it a significant player in the renewable energy market without even factoring in future growth.

Adding to that appeal is the lucrative traditional utility business model. Enbridge’s renewable facilities are regulated by the same long-term contracts as traditional utilities. In other words, those facilities will provide Enbridge with yet another stable and recurring revenue stream. This is great for investors, but there’s still more to love about Enbridge.

Reason #4: Income! Operating a growing and reliable business is key reason for investors to buy Enbridge today. Perhaps the greatest reason of all, however, is Enbridge’s dividend.

The company provides investors with a handsome quarterly dividend, which works out to an insane 6.71% yield. This makes Enbridge one of the better-paying dividend stocks on the market. For many investors, this may be reason enough to invest in Enbridge, and I haven’t even mentioned the solid history of annual upticks to that dividend.

Final thoughts In my opinion, Enbridge is a great income and growth stock that should be a core holding in any portfolio. Buy it, hold it, and let it grow.

The post 4 Reasons to Buy Enbridge (TSX:ENB) Today appeared first on The Motley Fool Canada.

Fool contributor Demetris Afxentiou owns shares of Enbridge. The Motley Fool owns shares of and recommends Enbridge.

This Article Was First Published on The Motley Fool

4 Reasons to Buy Enbridge (TSX:ENB) Today

Related Articles

Is Lightspeed (TSX:LSPD) Stock Price Still a Buy?
Is Lightspeed (TSX:LSPD) Stock Price Still a Buy? By The Motley Fool - Dec 05, 2021

Lightspeed Commerce (TSX:TSX:LSPD)(NYSE:LSPD) stock has been in a downward spiral for months. Currently trading for $64, it’s down 59% from its all-time high. The...

Could This Retail Stock Become a Tech Stock?
Could This Retail Stock Become a Tech Stock? By The Motley Fool - Dec 05, 2021

The line between retail and technology has been blurring for years. Nearly everything you can buy in a store is now also available online on the store’s website. This is...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email