Wednesday, April 20, 2011

Enbridge Inc

I first bought this stock (TSX-ENB) in Jul 2005 and then some more in November 2008 and in January 2009. To date I have made a total return of 16.5% per year. Probably, the dividend portion is around 2.6 to 2.7% per year. They on the dividend lists that I follow of Dividend Achievers and Dividend Aristocrats (see indices).

This company has consistently raised their dividend since 1995 that I know of. Both the 5 and 10 year growth in dividends has been good at 10.4% each year. On my original investment in 2005, I am earning a yield of 5.5% and overall, I am earning on my investment in this company a yield of 5%. They have just raised the dividend this year by 15.3%. The Payout rates are good at with a 5 year median payout on earnings of 63% and a 5 year median payout on cash flow of 33%.

All the growth rates for revenue, earnings, total return, cash flow and book value are good for this company with the exception of earnings over the last 10 years and that is a little low, but still fine. The 5 and 10 year EPS growth is 9.5% and 7.5% per year, respectively. For the other growth rates, for example, on revenues per share over the 5 and 10 years is 10% and 17% per year, respectively.

As far as debt ratios go, the Liquidity Ratios and the Asset/Liability Ratios are a bit low and the Leverage and Debt/Equity Ratios a bit high. The Liquidity Ratio is 1.12 and the Asset/Liability Ratio is 1.38. The leverage Ratio is 4.05 and the Debt/Equity Ratio 2.94. However, pipelines companies do tend to have high debt loads.

The last thing to look at is the Return on Equity. The ROE is good at 12.9% for the financial year ending in December 2010. The 5 year median ROE is also good at 13.7%. The ROE is usually higher than the current 12.9% rate.

Tomorrow, I will look at what my spreadsheet ratios say about the current price and what analysts have to say about this stock. For me, I believe that my investment in this stock has been a good investment.

Enbridge is focused on three core businesses of crude oil and liquids pipelines, natural gas pipelines, and natural gas distribution. They operate in Canada and US. Its web site is here Enbridge. See my spreadsheet at enb.htm.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. See my website for stocks followed and investment notes. Follow me on twitter.


  1. enbridge rapes everyone who invests

  2. Dear Anonymous. You sounds like you do not know anything about investing.