3 Reasons to Buy Enbridge Stock Like There’s No Tomorrow

Are you ready to buy Enbridge stock? Here are three reasons why now, more than ever, this stock belongs in your portfolio today.

| More on:
golden sunset in crude oil refinery with pipeline system

Source: Getty Images

There are few, if any stocks on the market today that represent such a lucrative opportunity for investors as Enbridge (TSX:ENB). Here’s a trio of reasons why you should buy Enbridge stock right now.

First, there’s the stable Enbridge you do know

Most investors are aware of Enbridge. The energy infrastructure behemoth is well-known, primarily for its pipeline business and there’s a good reason for that.

That pipeline business, which includes both crude and natural gas segments, is the largest and most complex pipeline system on the planet. And more importantly, it hauls massive amounts of crude and natural gas.

Specifically, Enbridge transports one-third of all North American-produced crude, and one-fifth of the natural gas needs of the U.S. This makes Enbridge an incredibly defensive option for any long-term portfolio.

But most investors may not be aware of everything else that Enbridge does, which adds to the reasoning to buy Enbridge stock right now.

Second, don’t forget the growing parts of Enbridge

Apart from its lucrative pipeline business, Enbridge also operates a growing renewable energy business. Renewables are growing in importance and Enbridge has dropped over $10 billion into the segment over the past two decades.

Today Enbridge’s renewable footprint includes approximately 40 facilities located across North America and Europe. Those facilities include solar, wind, and hydro operations.

And like fossil fuel-burning utilities, those facilities are bound by long-term regulated contracts. This means that those facilities generate a reliable (and growing) source of revenue for Enbridge. That reliable revenue stream allows Enbridge to invest in growth and pay a generous dividend (more on that in a moment).

As lucrative as that renewable operation sounds, it’s not the only other segment that Enbridge has. The company also operates the largest natural gas utility in North America.

And like its renewable business, the natural gas utility, which boasts over 6 million customers across the U.S. and Canada, is incredibly defensive and growing. Just in the past year alone, Enbridge has completed a trio of acquisitions to bolster its utility operation.

Collectively, all of Enbridge’s segments with their massive growth potential make the company an intriguing option to consider. But for investors looking to buy Enbridge stock for income, there’s good news as well.

Finally, let’s talk about Enbridge’s tasty dividend

Prospective investors looking to buy Enbridge stock should note that the company also offers a very tasty quarterly dividend. As of the time of writing, the yield works out to an insane 7.5%, making it one of the highest-paying yields on the market.

This means that investors who buy Enbridge stock will be handsomely rewarded. By way of example, let’s consider a $40,000 investment (always as part of a larger, well-diversified portfolio).  For that initial outlay, investors can expect to generate a healthy income just shy of $3,000.

But that’s not even the best part.

Enbridge has an established cadence of providing investors with a healthy annual bump to that dividend. That streak currently extends a whopping three decades, and Enbridge plans to continue that tradition.

This means that investors who buy Enbridge stock today but are not ready to draw on that income can reinvest it until needed. This will let any eventual income stream grow through reinvestments until needed.

Final thoughts: Will you buy Enbridge stock?

Enbridge is, in my opinion, a great long-term option that appeals to both growth and income-focused investors. Additionally, the company offers one of the tastiest yields on the market, and it continues to grow.

In other words, buy it, hold it, and watch it grow to form a part of your well-diversified portfolio.

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 Demetris Afxentiou has positions in Enbridge. The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy.

More on Top TSX Stocks

Dial moving from 4G to 5G
Dividend Stocks

This Undervalued Dividend Stock is Worth Buying Right Now

Want an undervalued dividend stock with long-term potential and a juicy yield? Here's an option you may regret not buying…

Read more »

grow dividends
Top TSX Stocks

Enbridge Stock Pays a Massive 7 Percent Dividend and Now is a Great Time to Buy  

Have you considered buying Enbridge stock lately? If not, you may want to buy this long-term gem to start earning…

Read more »

Stocks for Beginners

The Best Stocks to Invest $2,000 in Right Now

Looking for the best stocks to buy now and hold for decades? Here's a trio that can provide growth and…

Read more »

Money growing in soil , Business success concept.
Dividend Stocks

Want Fast-Growing Passive Income? Here are 3 Long-Term Dividend Stocks

Looking for some fast-growing passive income options? Here are three that can provide for decades which belong in your portfolio…

Read more »

Top TSX Stocks

3 Stocks to Buy While They Are on Sale

Looking for some of the best stocks to buy? Here are a handful of options that can provide growth and…

Read more »

Couple relaxing on a beach in front of a sunset
Dividend Stocks

Got $2,500? 2 Top Stocks You Can Buy and Hold for a Lifetime

Looking for some great stocks to buy and hold for a lifetime? Here are two options that are too hard…

Read more »

Stocks for Beginners

TFSA: 3 Canadian Stocks to Buy and Hold Forever             

Looking for the best Canadian stocks to buy and hold? Here are three options to add to your TFSA today…

Read more »

exchange-traded funds
Dividend Stocks

60 Stocks Under $50 New Investors Can Buy Confidently

New investors in Canadian stocks could add an outperforming edge and gain wide diversification at $33 a share

Read more »