Finding that perfect mix of growth and income-producing stocks can strike a perfect balance in every well-diversified portfolio. And while there’s no shortage of superb income and growth stocks in the market, some are clearly better than others. By way of example, here’s a dividend giant to consider for your portfolio.
In fact, this dividend giant, Enbridge (TSX:ENB), is a stock I’d buy right now over a growth-focused stock like Shopify (TSX:SHOP).
Why Enbridge and why now?
Enbridge is the dividend giant I would consider over Shopify right now. Enbridge is an energy infrastructure behemoth with its massive tentacles entrenched in several areas of the market.
The company is best known for its massive pipeline segment. That segment, which includes both crude oil and natural gas elements, is the largest and most complex pipeline system on the planet. That immense size generates the bulk of Enbridge’s revenue and solidifies Enbridge as a defensive gem.
To consider the sheer size of that network, consider this fact. Enbridge transports nearly one-third of all North American-produced crude through its network. Turning to gas, Enbridge hauls one-fifth of the natural gas needs of the U.S. market.
Surprisingly, that’s not even the best part.
Enbridge also operates the largest natural gas utility in North America following the acquisition of three utilities earlier this year.
Enbridge also boasts a sizable renewable energy segment comprising over 40 facilities. Those facilities, which are located across North America and Europe, generate enough electricity to power over one million homes.
In short, Enbridge is a diversified, defensive option that continues to invest in growth.
Let’s talk about income
Perhaps one of the main reasons why investors flock to Enbridge is because it is a dividend giant. The company offers a quarterly dividend that currently carries a yield of 7.71%. That yield handily makes Enbridge one of the best-paying dividends on the market.
To illustrate the earnings potential of that yield, let’s consider an investment of $40,000. For that initial investment, prospective investors can look to earn an income of nearly $3,080. Even better, investors who aren’t ready to draw on that income can choose to reinvest it until needed.
Finally, it’s also worth noting that Enbridge has provided annual upticks to that dividend for the past three decades without fail. The company also plans to continue that cadence.
Let’s talk about Shopify
To be clear, I think Shopify is a great stock to own too. The e-commerce titan has made some great moves over the past year. That includes both updating its pricing model as well as spinning off less-performing segments of its business.
That improvement is one reason why the stock has shot up over 100% this year. Yet despite that stellar improvement, the stock still sits nearly 50% lower than it was just over two years ago.
And while growth-seeking investors may appreciate that long-term opportunity, today’s focus is on a dividend giant like Enbridge.
Final thoughts: Buy this dividend giant today
No stock, even a defensive gem like Enbridge, is immune to volatility. This is why the importance of diversifying cannot be understated.
In my opinion, Enbridge is a superb dividend giant that should be a core holding in any well-diversified portfolio.
