Enbridge (TSX:ENB)(NYSE:ENB) is perhaps my top pick in the Canadian market right now. The company is most certainly my top pick in the pipeline space.
Investing in such companies is a great tip for investors who are taking income in this period of record low interest rates. Interest rates are broadly expected to remain at or near all time lows for some time to come. I believe a significant amount of capital is set to flow into such equity sectors, away from fixed income securities.
Enbridge’s dividend has hovered around 7%. The company has continued to pay its dividend despite obvious risks, which are currently being priced in. The company's current dividend yield remains materially higher than its long term average.
This makes the stock a great long-term pick at these levels, even for those who do not believe dividends will hold in the near term. I find myself in this camp due mainly to the very high quality nature of cash flows, as well as the relatively limited pipeline capacity in Canada.
In addition, Enbridge’s most recent earnings projections are both reasonable and encouraging, reinforcing such a perspective. At this stock price level, investors have a solid entry point. This is a good option for investors looking to build a new position in the energy infrastructure company, or for those that need to add to an existing position to their holdings.
Invest wisely, my friends.
