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Enbridge Inc. (TSX:ENB) and Altagas Ltd. (TSX:ALA): Once-in-a-Lifetime Opportunities for Long-Term Investors

Enbridge Inc. (TSX:ENB)(NYSE:ENB) stock is trading at such depressed levels that it won’t take much to get the stock going again. In the meantime, we have a 6.3% dividend yield to sit back and enjoy.

Not a bad deal.

Because if we keep an eye on the long-term, we will realize that $71.3 billion Enbridge, with its extensive energy infrastructure consisting of pipelines and regulated utilities has been around for more than 65 years — and will be around for many more.

Not only will it be around, but it will continue to be profitable, providing investors who were smart and lucky enough to be shareholders with solid returns.

In fact, since 1996, investors have enjoyed 22 years of dividend increases, with a 33% dividend increase in 2015, a 14% increase in 2016, and a 15% increase in 2017.

Management expects the dividend to increase at a 10% compound average growth rate from 2017 to 2020.

This year, Enbridge has addressed many of the concerns that investors had about the stock, and so it has rallied 13% off its lows of April 2018.

Enbridge’s recent asset sales have addressed the funding issue, the approval of L3R was key, and strong first half of 2018 results injected confidence in the stock.

In addition, the company increased 2018 guidance and reiterated its confidence in its two-year growth plan (10% annual dividend growth rate).

Finally, the addition of Spectra Energy has provided visibility into growth well beyond the 2020 time frame.

Altagas Ltd. (TSX:ALA)

With a current dividend yield of 10.4%, Altagas stock is paying its shareholders handsomely.

But don’t let the high dividend yield fool you into thinking this is not a high-quality stock.

With its diversified infrastructure platform of high quality assets, and 80% of its EBITDA coming from contracted medium and long term agreements, Altagas has stability on its side.

In the last five years, Altagas has grown its asset base to over $10 billion from $3 billion through acquisitions as well as construction projects, and it has delivered a compound annual growth rate in its dividend of 9%.

In the last two-years, it has had a dividend growth rate of almost 6%. Going forward, dividend growth will be supported by new projects as well as the accretion from the WGL acquisition.

WGL’s high-quality assets and market position will bring Altagas many growth opportunities as well as significant earnings and cash flow accretion.

The company’s payout ratio and liquidity are both relatively healthy, thus enabling it to have flexibility to support dividend hikes.

We can expect further asset sales this year. This will help fund the acquisition, and should take some of the uncertainty out of the stock and drive it higher.

Additionally, the recent approval of LNG Canada’s project bodes well for Altagas stock, both in terms of market sentiment and actual volumes that will ultimately come through its Montney facilities.

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Fool contributor Karen Thomas owns shares of ALTAGAS LTD. Enbridge is a recommendation of Stock Advisor Canada.

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