Investment Comparison: Enbridge vs. Oneok
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 6 days ago
0mins
Source: Fool
- Stable Cash Flow: Enbridge's earnings are backed by over 98% from regulated rate structures or take-or-pay contracts, ensuring stable cash flow that supports its 4.9% high dividend yield, reflecting strong financial stability.
- Diversified Business Model: Enbridge not only holds North America's largest gas utility franchise but is also expanding in renewable energy, which is expected to drive a 5% annual growth in cash flow per share, fueling dividend growth.
- Investment in Growth Projects: Enbridge has secured CA$37 billion (approximately $26.5 billion) in commercial growth capital projects expected to come online by 2030, while pursuing another CA$50 billion (approximately $37.8 billion) in expansion projects, enhancing its competitive edge.
- Future Growth Potential: Oneok is investing about $1 billion in two joint ventures with MPLX, which is expected to support its annual dividend growth of up to 4%, while acquiring and developing more fee-based assets to enhance the stability of its revenue sources.
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Analyst Views on ENB
Wall Street analysts forecast ENB stock price to fall
10 Analyst Rating
5 Buy
5 Hold
0 Sell
Moderate Buy
Current: 54.470
Low
45.79
Averages
53.54
High
69.00
Current: 54.470
Low
45.79
Averages
53.54
High
69.00
About ENB
Enbridge Inc. is an energy transportation and distribution company. The Company's segments include Liquids Pipelines, Gas Transmission, Gas Distribution and Storage, and Renewable Power Generation. Liquids Pipelines consists of pipelines and terminals in Canada and United States that transport and export various grades of crude oil and other liquid hydrocarbons, including the Mainline System, Regional Oil Sands System, Gulf Coast and Mid-Continent, and Other. Gas Transmission consists of its investments in natural gas pipelines and gathering and processing facilities in Canada and United States, including United States Gas Transmission, Canadian Gas Transmission, United States Midstream, and Other. Gas Distribution and Storage consists of its rate-regulated natural gas utility operations in Canada and United States. Renewable Power Generation consists primarily of investments in wind and solar assets, as well as equity interests in geothermal power and power transmission assets.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
S&P 500 Dividend Yield Hits Record Low Amid Market Surge
- Dividend Yield Decline: The S&P 500's average dividend yield has fallen to a historic low of just over 1%, reflecting how the market's strong rally has made dividend income scarce, which may discourage income-focused investors.
- Stable Energy Demand: Enbridge transports 5.8 million barrels of oil and liquids daily, handling 30% of North America's crude and 20% of U.S. natural gas, indicating that despite volatile oil prices, energy demand remains robust, supporting its reliable revenue stream.
- Long-Term Dividend Growth: Enbridge's 31-year streak of annual dividend increases highlights the stability of its business model, especially as U.S. natural gas demand is projected to reach record levels, ensuring its ability to maintain consistent dividend payments.
- Renewable Energy Investment: While primarily reliant on traditional energy, Enbridge is investing in renewables like wind and solar, indicating a strategic preparation for future transitions, although short-term capital appreciation may be limited.
See More
Enbridge Offers High Dividend Amid Market Bullishness
- Dividend Yield Advantage: Enbridge's forward-looking dividend yield of 5.1% stands out as the S&P 500's yield drops to a historic low of 1% due to market bullishness, making it particularly attractive for income investors seeking stable returns.
- Pipeline Network Scale: Enbridge operates over 18,000 miles of natural gas and crude oil pipelines in the U.S. and Canada, transporting 5.8 million barrels of oil and liquids daily, handling 30% of North America's crude and 20% of U.S. gas consumption, ensuring a stable revenue stream to support ongoing dividend payments.
- Sustained Demand Growth: The U.S. Energy Information Administration reports that natural gas consumption reached nearly 2.78 trillion cubic feet in March, up 1% year-over-year, while crude oil deliveries increased by 2%, indicating strong energy demand despite price volatility, further solidifying Enbridge's business foundation.
- Renewable Energy Investment: While Enbridge's core business relies on fossil fuels, the company is actively investing in renewables like wind and solar, demonstrating a forward-looking approach to energy transition; although short-term capital appreciation may be limited, this long-term strategy will enhance its market competitiveness.
See More
Investment Portfolio Strategy Analysis
- Blue Chip Investment: Allocating $6,000 to Enbridge (ENB), which has consistently grown its dividend to a yield of 5% over decades, provides investors with stable cash flow and enhances safety and appeal in the oil and gas sector.
- Growth Stock Selection: Investing $3,000 in Alphabet (GOOG), which has generated $160 billion in profit over the past four quarters through diversified assets like YouTube and Google Search, showcases strong financial strength and future growth potential.
- High-Risk, High-Reward: The remaining $1,000 is allocated to CRISPR Therapeutics (CRSP), which, despite being unprofitable, has a market cap of $5 billion and over $2 billion in cash reserves to support its gene-editing therapy development, indicating significant growth potential.
- Risk Management Strategy: By establishing a strong blue-chip foundation in the portfolio, investors can take on some risk while ensuring the overall safety of their investments, thus maintaining stable returns amid market volatility.
See More
Investment Strategy Analysis for Blue Chip Stocks
- Blue Chip Investment Foundation: Investing in blue chip stocks like Enbridge (NYSE: ENB) provides a stable foundation for a portfolio, with the company growing its dividends for decades and currently offering a 5% yield, making it an excellent long-term hold in the oil and gas sector.
- Stable Income and Risk Control: Enbridge's stock has risen 16% this year amid increasing demand for oil and gas stocks due to rising commodity prices, and its average beta of 0.81 over the past five years indicates lower volatility compared to the overall market.
- Growth Potential Investment: Allocating funds to Alphabet (NASDAQ: GOOG) leverages the company's diversified assets across YouTube and Google Search, showcasing strong financial health with a staggering $160 billion in profit over the past four quarters, representing a low-risk growth opportunity.
- Cutting-Edge Biotech Investment: Choosing CRISPR Therapeutics (NASDAQ: CRSP) for its significant growth potential, despite being unprofitable, it has a market cap of $5 billion and over $2 billion in cash to support its gene-editing therapies, positioning it well for future commercialization efforts.
See More
Enbridge Completes EPI Note Exchange Transaction
- Transaction Completion: Enbridge and its wholly-owned subsidiary EPI announced the completion of the note exchange transaction, where all outstanding EPI medium-term notes are replaced with newly issued notes of equal principal amount, ensuring financial flexibility for EPI.
- Operational Flexibility Enhanced: The note exchange transaction provides EPI with greater operational flexibility while delivering a range of operational, structural, and capital market benefits to Enbridge and former EPI noteholders, thereby enhancing the overall financial health of the company.
- Market Participants' Roles: BMO Nesbitt Burns Inc. acted as the Solicitation Agent for the transaction, Computershare Investor Services Inc. served as the Tabulation Agent, and Sodali & Co. acted as the Information Agent, ensuring the smooth execution of the transaction.
- Forward-Looking Statements: Enbridge and EPI included forward-looking information in the release, emphasizing that the transaction will provide operational flexibility for EPI, while noting that these statements involve various assumptions and uncertainties that may impact future performance.
See More
Investment Comparison: Enbridge vs. Oneok
- Stable Cash Flow: Enbridge's earnings are backed by over 98% from regulated rate structures or take-or-pay contracts, ensuring stable cash flow that supports its 4.9% high dividend yield, reflecting strong financial stability.
- Diversified Business Model: Enbridge not only holds North America's largest gas utility franchise but is also expanding in renewable energy, which is expected to drive a 5% annual growth in cash flow per share, fueling dividend growth.
- Investment in Growth Projects: Enbridge has secured CA$37 billion (approximately $26.5 billion) in commercial growth capital projects expected to come online by 2030, while pursuing another CA$50 billion (approximately $37.8 billion) in expansion projects, enhancing its competitive edge.
- Future Growth Potential: Oneok is investing about $1 billion in two joint ventures with MPLX, which is expected to support its annual dividend growth of up to 4%, while acquiring and developing more fee-based assets to enhance the stability of its revenue sources.
See More
S&P 500 Dividend Yield Hits Record Low Amid Market Surge
- Dividend Yield Decline: The S&P 500's average dividend yield has fallen to a historic low of just over 1%, reflecting how the market's strong rally has made dividend income scarce, which may discourage income-focused investors.
- Stable Energy Demand: Enbridge transports 5.8 million barrels of oil and liquids daily, handling 30% of North America's crude and 20% of U.S. natural gas, indicating that despite volatile oil prices, energy demand remains robust, supporting its reliable revenue stream.
- Long-Term Dividend Growth: Enbridge's 31-year streak of annual dividend increases highlights the stability of its business model, especially as U.S. natural gas demand is projected to reach record levels, ensuring its ability to maintain consistent dividend payments.
- Renewable Energy Investment: While primarily reliant on traditional energy, Enbridge is investing in renewables like wind and solar, indicating a strategic preparation for future transitions, although short-term capital appreciation may be limited.
See More
Enbridge Offers High Dividend Amid Market Bullishness
- Dividend Yield Advantage: Enbridge's forward-looking dividend yield of 5.1% stands out as the S&P 500's yield drops to a historic low of 1% due to market bullishness, making it particularly attractive for income investors seeking stable returns.
- Pipeline Network Scale: Enbridge operates over 18,000 miles of natural gas and crude oil pipelines in the U.S. and Canada, transporting 5.8 million barrels of oil and liquids daily, handling 30% of North America's crude and 20% of U.S. gas consumption, ensuring a stable revenue stream to support ongoing dividend payments.
- Sustained Demand Growth: The U.S. Energy Information Administration reports that natural gas consumption reached nearly 2.78 trillion cubic feet in March, up 1% year-over-year, while crude oil deliveries increased by 2%, indicating strong energy demand despite price volatility, further solidifying Enbridge's business foundation.
- Renewable Energy Investment: While Enbridge's core business relies on fossil fuels, the company is actively investing in renewables like wind and solar, demonstrating a forward-looking approach to energy transition; although short-term capital appreciation may be limited, this long-term strategy will enhance its market competitiveness.
See More
Investment Portfolio Strategy Analysis
- Blue Chip Investment: Allocating $6,000 to Enbridge (ENB), which has consistently grown its dividend to a yield of 5% over decades, provides investors with stable cash flow and enhances safety and appeal in the oil and gas sector.
- Growth Stock Selection: Investing $3,000 in Alphabet (GOOG), which has generated $160 billion in profit over the past four quarters through diversified assets like YouTube and Google Search, showcases strong financial strength and future growth potential.
- High-Risk, High-Reward: The remaining $1,000 is allocated to CRISPR Therapeutics (CRSP), which, despite being unprofitable, has a market cap of $5 billion and over $2 billion in cash reserves to support its gene-editing therapy development, indicating significant growth potential.
- Risk Management Strategy: By establishing a strong blue-chip foundation in the portfolio, investors can take on some risk while ensuring the overall safety of their investments, thus maintaining stable returns amid market volatility.
See More
Investment Strategy Analysis for Blue Chip Stocks
- Blue Chip Investment Foundation: Investing in blue chip stocks like Enbridge (NYSE: ENB) provides a stable foundation for a portfolio, with the company growing its dividends for decades and currently offering a 5% yield, making it an excellent long-term hold in the oil and gas sector.
- Stable Income and Risk Control: Enbridge's stock has risen 16% this year amid increasing demand for oil and gas stocks due to rising commodity prices, and its average beta of 0.81 over the past five years indicates lower volatility compared to the overall market.
- Growth Potential Investment: Allocating funds to Alphabet (NASDAQ: GOOG) leverages the company's diversified assets across YouTube and Google Search, showcasing strong financial health with a staggering $160 billion in profit over the past four quarters, representing a low-risk growth opportunity.
- Cutting-Edge Biotech Investment: Choosing CRISPR Therapeutics (NASDAQ: CRSP) for its significant growth potential, despite being unprofitable, it has a market cap of $5 billion and over $2 billion in cash to support its gene-editing therapies, positioning it well for future commercialization efforts.
See More
Enbridge Completes EPI Note Exchange Transaction
- Transaction Completion: Enbridge and its wholly-owned subsidiary EPI announced the completion of the note exchange transaction, where all outstanding EPI medium-term notes are replaced with newly issued notes of equal principal amount, ensuring financial flexibility for EPI.
- Operational Flexibility Enhanced: The note exchange transaction provides EPI with greater operational flexibility while delivering a range of operational, structural, and capital market benefits to Enbridge and former EPI noteholders, thereby enhancing the overall financial health of the company.
- Market Participants' Roles: BMO Nesbitt Burns Inc. acted as the Solicitation Agent for the transaction, Computershare Investor Services Inc. served as the Tabulation Agent, and Sodali & Co. acted as the Information Agent, ensuring the smooth execution of the transaction.
- Forward-Looking Statements: Enbridge and EPI included forward-looking information in the release, emphasizing that the transaction will provide operational flexibility for EPI, while noting that these statements involve various assumptions and uncertainties that may impact future performance.
See More
Investment Comparison: Enbridge vs. Oneok
- Stable Cash Flow: Enbridge's earnings are backed by over 98% from regulated rate structures or take-or-pay contracts, ensuring stable cash flow that supports its 4.9% high dividend yield, reflecting strong financial stability.
- Diversified Business Model: Enbridge not only holds North America's largest gas utility franchise but is also expanding in renewable energy, which is expected to drive a 5% annual growth in cash flow per share, fueling dividend growth.
- Investment in Growth Projects: Enbridge has secured CA$37 billion (approximately $26.5 billion) in commercial growth capital projects expected to come online by 2030, while pursuing another CA$50 billion (approximately $37.8 billion) in expansion projects, enhancing its competitive edge.
- Future Growth Potential: Oneok is investing about $1 billion in two joint ventures with MPLX, which is expected to support its annual dividend growth of up to 4%, while acquiring and developing more fee-based assets to enhance the stability of its revenue sources.
See More
