Fossil fuel moves the world. Even if the current decade has been hard on one of the largest global markets — oil and gas — some companies have weathered the downturn better than others. If you thought that the days of investing in oil-related industries are gone, think again.
Enbridge (TSX:ENB)(NYSE:ENB) operates one of the most extensive crude oil and gas pipeline networks in the world. Operating chiefly in North America, the company provides about 20% of gas consumed in the U.S. and 25% of the total crude oil produced in North America.
Enbridge has a solid history of operations and many prospects that make Enbridge a relatively safe investment. Especially in a market that is strapping up for fear of another recession. Buying in stable companies like Enbridge is one of the best ways to diversify your investment portfolio.
Enbridge has an amazing history of paying dividends. The company has increased payouts for the past 19 years consecutively, making it a great stock to hold. Even if the market value of the company fluctuates, along with the shaky oil and gas market, the consistent payouts make it a valuable and secure investment.
Enbridge’s last quarterly dividend was $0.7380 per share. It has a dividend of $2.95 this year, and this is only expected to increase in the future. This projection makes Enbridge a safe, consistently paying company that generously rewards its investors.
Enbridge’s current dividend yield is 6.49%.
Can you hold it for a very long time?
Yes. Enbridge is a $93.81 billion giant with pipelines all over North America. The company has seen almost constant growth in its market value since mid-last year. The company almost has a monopoly on oil and gas distribution, which doesn’t seem to be toppling anytime soon.
The Canada Energy Regulator (CER), upon demands from other energy countries in the country, closed Enbridge’s open season at the end of last month. Now the company has to apply to CER for mainland tolls and T&Cs.
Even though this is a setback for the company, and has affected market value a bit, it shows how much potential it has. And how much fuel distribution the company has covered compared to its competitors.
Enbridge has invested billions in building safe pipelines and is expected to invest heavily in the future as well. The company has also invested extensively in alternative energy programs, both in country and offshore. This commitment to growth shows indicates the future projection and diversification of the company.
The current market value of the company is $46.35 per share. It is not an all-time low, but it’s lower compared to the first half of the year. Buying in right now might be a good move for strengthening your investment portfolio. The company may see a harsh last quarter because of the shipping regulations.
But this little upheaval is nothing compared to what the company has been through. Its market presence, future growth, and history of payouts combine to make a stock you can buy and hold forever.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns shares of Enbridge. Enbridge is a recommendation of Stock Advisor Canada.