1 Beaten-Down Stock That Could Be the Best Bet in the TSX

Enbridge (TSX:ENB) stock has been crushed in recent years, but it’s showing signs of waking up!

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The technology sector took one right to the chin last Friday, as the Nasdaq 100 led the way loading, dragging down broader indices by around 5% from their highs. Indeed, it was an ugly day on Wall Street if you were just a tad overweight on the technology plays. If you went big on the artificial intelligence (AI) trade, you may have felt the full force of the impact.

In any case, the TSX Index, which is full of value names, actually ended Friday’s trading session in the green, up by just shy of 0.5%. Indeed, the TSX Index is starting to look that much more attractive to Canadian investors who are looking to rotate back to value now that the tech trade has shown signs of contraction.

Looking ahead, I’d not be surprised if we experienced more days like Friday, whereby tech stocks shed considerable ground while value barely feels the rumbles, perhaps even ending big down days in the green.

In this piece, we’ll check out one intriguing and beaten-down stock that finished Friday’s horrid session higher. Looking ahead, I think more relative outperformance could be in the cards as the TSX stock looks to continue moving forward with its long-term game plan.

Without further ado, let’s have a closer look into shares of pipeline firm Enbridge (TSX:ENB), which had a terrific day on Friday, taking off almost 3% while the Nasdaq 100 shed more than 2%. As the growth-to-value rotation continues, my bet is that Enbridge stock will be the name to own.

Enbridge stock: A big up day on a brutal down day for tech and U.S. markets

Enbridge stock is finally getting its day to shine, and it’s about time, too! With shares going for 16.89 times trailing price to earnings (P/E), I still view the $102 billion pipeline kingpin as cheap. The biggest reason to own the cash cow, though, has to be the dividend yield, which is going for 7.84%.

While a sudden pullback could propel the yield back above 8%, I’d not look for tech-focused weakness to drag Enbridge down. In fact, sellers of the overheated tech and AI stocks may look to park their cash in steady dividend-growth sensations like Enbridge.

Personally, I don’t think it’s a bad idea to buy ENB stock after its single-day surge. In fact, I view ample room to run as Enbridge finally gets the respect it deserves, as overvalued tech plays come back to Earth.

Most recently, U.S. president Joe Biden’s administration noted that the court may wish to reconsider the shutdown order of the Line 5 pipeline. If the line doesn’t shut, Enbridge stock may have fuel for its current rally off last year’s lows.

The Foolish bottom line for Canadian value investors

As the tech trade falters, Canadian investors should look to some of the many neglected dividend plays before the Bank of Canada has a chance to announce its very first interest rate cut. As rates come down, value stocks go back in style on Bay Street, and Enbridge continues navigating the turbulent climate, I’d not be afraid to nibble on shares while the yield is still well above historical norms.

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 Joey Frenette has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy.

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