Enbridge Inc (TSX:ENB)(NYSE:ENB) released its quarterly results last week, and although sales were up 14% from the prior year, the bottom line was not as strong with earnings dropping 26%.
The company saw its operating and other expenses climb more than 20% as they eroded away the positive results gained from the strong sales growth in Q1. Specifically, asset impairment costs of $1.06 billion took a big chunk out of the company’s profits in what otherwise should have been a very strong quarter.
The company is optimistic that good results will follow and said that it is on track to meet its guidance for the year.
In addition, we should see even stronger results as new capital projects are taken on and the company begins to see the efficiency and other benefits gained from its deal with Spectra Energy.
While the stock has been down around 20% in the past year, the recent results have given the stock a boost as it was up over 4% last week and back up to over $43 a share. This is a good sign for a stock that has been struggling to find any positive momentum.
Enbridge’s dividend still remains high as it currently pays investors 6.2%, and payouts are likely to grow as the company has a strong reputation for hiking its dividends, even when times may not be great.
It could be a great time for investors to buy Enbridge as it may have finally turned a corner and this could be just the momentum that it needs to take off.
