Tag Archives: TSX:TRP

Industry Pullback: Buying Opportunities In Dividend Growth Stocks

This article first appeared in the Seeking Alpha Marketplace service DGI Across North America.

Six dividend growth stocks from the energy infrastructure space are discussed. They offer yields of 4.6-7.5% and double-digit price appreciation potential in the near term.

The energy infrastructure stocks have pulled back meaningfully due more or less to the lower commodity prices. These stocks are safer and less volatile than energy stocks, which have direct exposure to lower-priced commodities.

For income investors, it is a good opportunity to consider the energy infrastructure stocks, which tend to grow their dividends over time.

oil refinery

Enbridge Inc. (TSX:ENB)(NYSE:ENB)

Enbridge is the biggest company with the largest scale. Here’s how the company looks like after combining with Spectra Energy Corp. If you’re looking for safety and strong dividend growth, Enbridge is your stock.

Enbridge is ~15% below its 52-week high of ~C$59 per share and ~1.8% higher than its 52-week low of C$49.20 per share.

Enbridge is a diversified business. It produces and processes natural gas, has a complex pipeline system that transports liquids and gas across North America, and generates power with wind, solar, and geothermal facilities.

The company has increased its dividend per share (“DPS”) for 21 consecutive years. In the last 20 years, it has compounded its DPS by 11.2% per year.

Source: Enbridge website

Through 2024, Enbridge expects to hike its DPS by 10-12% per year. Currently, it’s a good time to buy some shares at an attractive yield of ~4.9%.

The street consensus at Thomson Reuters [TSX:TRI](NYSE:TRI) has a mean 12-month target of C$62.30 on the stock, which represents ~24% upside potential in the near term.

F.A.S.T. Graphs also show that Enbridge is undervalued as a multi-year investment as its cash flow per share growth is estimated to grow at a double-digit rate in 2018 and 2019.

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Great Canadian Dividend Buys: Large-Cap Pipelines

Exploring 3 large-cap Canadian pipelines that have continued to maintain and increase their dividends since oil prices plummeted. Which of Enbridge Inc (TSX:ENB)(NYSE:ENB), TransCanada Corporation (TSX:TRP)(NYSE:TRP), or Pembina Pipeline Corp. (TSX:PPL)(NYSE:PBA) pays out the safest dividend of the group? Which company has the best dividend prospects? Should investors buy these Canadian pipeline companies now or wait?

Kinder Morgan Inc (NYSE:KMI) got a lot of attention when it slashed its dividend by 75%. At the same time, its share price has fallen over 60% from more than $40 to under $16. Yet, strong Canadian energy infrastructure leaders such as Enbridge Inc and TransCanada Corporation have not only maintained but continued to grow their dividends. At the same time, they have also been sold off due to lower oil prices.

  • Enbridge increased its dividend by 14% this year and it would be its 21st consecutive year increase.
  • TransCanada should be announcing its dividend hike for this year by the end of March, which would be its 16th consecutive year increase.
  • Pembina hiked its dividend by 5.2% in May; it has increased it for 4 consecutive years.

Are Their Dividends Sustainable?

Enbridge, TransCanada, and Pembina Pipeline are only more attractive than a year ago if they can maintain healthy dividends. Can they? Read More

Did You Do Dividend Stocks Christmas Shopping?

While you’re shopping for gifts for family and friends, don’t forget to shop for quality dividend stocks that are on sale as well. These dividend stocks could be the ultimate gift for yourself, your children, and or grandchildren because the best dividend stocks paid dividends for decades and are likely to pay more dividends for decades to come!

dividend stocks Christmas shopping

Canadian Banks On Sale

Just on Monday, we saw Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) yielding 5%. This is one solid Canadian bank that has paid dividends since 1832. In fact, it has even increased dividends for 43 out of the last 45 years. (I think shareholders would forgive that it froze dividends instead of cutting them in 2009 and 2010 due to being cautious about the financial crisis.)

Even now, after Bank of Nova Scotia rebounded about 2.6% to the $57 level, it’s still a good buy for long-term investment. It yields 4.9%, and its fair value one year from now is around $73, based on its long-term historical multiple. This implies the bank’s shares are about 20% off.

Another bank that’s on sale is National Bank of Canada (TSX:NA). Similar to the Bank of Nova Scotia, National Bank of Canada pulled back to levels that yielded a high yield of 5.4%.

By Wednesday, it has rallied about 2% to $41. It still yields 5.3%, which is a good deal for the sixth largest bank of Canada. Its fair value one year from now is around $51. This implies the bank’s shares are also about 20% off. Read More