For any investor considering putting a 10-stock portfolio together today, I was certain certainly recommend Enbridge Inc. (TSX:ENB)(NYSE:ENB) to be considered a candidate for a spot. On a valuation basis alone, Enbridge continues to look cheap, particularly with respect to where the company has historically traded in the past. Relatively high levels of debt have turned many investors off, as the focus for most investors today seems to be only on those companies with the most pristine of balance sheets.
That said, Enbridge does have a great amount of relative value, trading at a discount to its peers. Its core assets are higher quality, in my view, compared to its peers based on both the grade of product shipped as well as the counterparty risk level Enbridge has compared to its peers.
As perhaps the most prominent energy infrastructure player in Canada, Enbridge has built a pipeline of high quality producers to contract with, giving Enbridge the edge for me from a risk perspective. Additionally, the contracts Enbridge has negotiated are among the best in the industry, with a significant amount of take or pay volume contracts solidifying revenue streams in a time of uncertainty.
The selloff we've seen in the energy sector has resulted in the wheat, in many cases, being thrown out with the chaff. Enbridge is one company showing excellent value today all investors ought to consider.
Invest wisely, my friends.
