#4 - Enbridge (NYSE:ENB)
The current collapse of oil prices is two-fold. First, there is a crisis of supply and demand. In this case, there is far too much supply and far too little demand. Second there was a pricing war between Russia and Saudi Arabia. With this in mind, it’s unrealistic to expect that pipeline volumes won’t be affected in some way.
Nevertheless, companies like Enbridge (NYSE:ENB) are somewhat insulated from those problems. Virtually all of the company’s cash flow (98%) is derived from the stability of instruments such as fee-based contracts that allow them to get paid even if demand is contracted. And, the vast majority of the company’s shippers have investment-grade credit ratings which means that they usually pay their contracts.
When you combine that with the strength of Enbridge’s own financial strength, you can look at the dip in the country’s share price as an opportunity. Enbridge has an investment-grade credit rating and a low leverage ratio. The company also offers an attractive dividend that has been increasing at an average rate of nearly 10% for the last 8 consecutive years.
About Enbridge
Enbridge Inc, together with its subsidiaries, 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.
Read More - Current Price
- $35.12
- Consensus Rating
- Hold
- Ratings Breakdown
- 3 Buy Ratings, 6 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $55.20 (57.2% Upside)
