Bargain Hunters: TRP Stock is the Best Dividend Deal Around!

TRP stock (TSX:TRP) offers a high dividend, but is still trading lower than 52-week highs. Now is the best time to buy.

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Shares of TC Energy (TSX:TRP) continue to trade lower than 52-week highs. At the time of writing this article, TRP stock trades at 11% lower than a year ago. However, there has been some positive momentum that investors should certainly consider. Especially for those looking for a deal on a strong dividend stock.

Why TRP stock

There are a few reasons to consider TRP stock, but first let’s go over what this company does in the first place. The company is a major North American energy infrastructure company operating primarily in three segments. These include natural gas pipelines, liquid pipelines, and storage.

Therefore the company plays a vital role in North America’s energy infrastructure, transporting natural gas and crude oil from production areas to markets. However, there have been major challenges and controversies over the years. These include the Keystone Pipeline, which was ultimately abandoned in June of 2021.

Since then, there has been a lot of expansion in other areas. This includes in renewable energy production. The company has been investing in renewables such as wind, solar, and hydro energy pump storage projects. It has also created partnerships for the transition of economies moving away from coal.

Growth is in the earnings

Now after such a long saga of issues with natural gas and crude oil pipelines, the company has been smart to slowly but surely move over to renewable energy production, storage, and transportation. This is where the future lies, but the company still benefits from ongoing use of natural gas and oil. So investors can get the best of both worlds.

And that’s demonstrated in its earnings. Here I like to look at how the company has performed quarter after quarter, to assess if it has been seeing some strong momentum. In this case, TRP stock has definitely been demonstrating positive momentum.

During the second quarter, the company delivered $250 million in net income, with $981 million in comparable earnings. This shrunk in the third quarter to a loss of $197 million in net income, but rose to $1 billion in comparable earnings. Yet by the fourth quarter, the company reported record 2023 operating and financial results. Net income surged to $1.5 billion in the fourth quarter and $2.8 billion for the year. That was far higher than the $641 million in 2022.

A strong buy

Overall, TRP stock has demonstrated strong momentum with even more growth on the way through its diversified set of energy assets. It continues to also offer a 7.64% dividend yield as of writing! All while trading at just 18.3 times earnings. TRP has also demonstrated a strong profit margin at 18.3%, with a strong 8.4% return on equity as well. 

So while shares may be down 11%, I wouldn’t think that the decline will continue for long. And that could mean investors can still achieve a great deal on a great dividend stock. And at the right time as momentum continues upwards.

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 Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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