Valued at a market cap of $134 billion, Enbridge (TSX: ENB) is among the most popular dividend stocks in Canada. Since the start of 2001, the TSX stock has returned 485% to shareholders. However, if we adjust for dividend reinvestments, cumulative returns are much closer to 1,540%.
Despite these market-beating returns, ENB stock currently offers shareholders a robust dividend yield of 6.1%, making it an attractive option for income investors. Let’s see if you should consider owning ENB stock due to its high dividend payout.
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Is Enbridge stock a good buy today?
Enbridge is a North American energy infrastructure company operating in four main segments: Liquids Pipelines (transporting crude oil), Gas Transmission (natural gas pipelines), Gas Distribution and Storage (utility services), and Renewable Power Generation (including wind, solar, and geothermal assets). Founded in 1949 and headquartered in Calgary, Enbridge provides essential energy transportation and distribution services.
Enbridge reported record first-quarter 2025 results with EBITDA (earnings before interest, tax, depreciation, and amortization), DCF (distributable cash flow) per share, and earnings per share all reaching new highs, driven by contributions from acquired U.S. utilities and strong volumes across the business.
The energy giant reaffirmed its 2025 financial guidance, which showcases the resilience of its utility-like business model amid market volatility.
The Mainline achieved record first-quarter volumes of 3.2 million barrels per day, while Ingleside posted another quarterly volume record. Enbridge secured $3 billion in accretive low-risk projects year-to-date, including a $300 million investment for a 10% stake in the Matterhorn Express pipeline and the sanctioning of the Traverse Pipeline project.
Growth drivers
Management’s strategic focus on building a Permian gas “super system” is gaining momentum, with the company now controlling equity interests in 30% of Permian egress capacity once Blackcomb enters service in 2026. The gas transmission business grew 13% year-over-year, despite asset sales, indicating strong underlying demand from data centres, coal-to-gas transitions, and LNG facilities.
The integration of three U.S. gas utilities acquired in 2024 is proceeding ahead of schedule, providing additional diversification and growth opportunities. With over 98% of EBITDA protected by regulated or take-or-pay frameworks, Enbridge maintains minimal commodity exposure while benefiting from inflation protection mechanisms.
Enbridge emphasized that it expects minimal impact from ongoing trade tensions and tariffs, reinforcing the defensive characteristics of its infrastructure assets. A focus on balance sheet management, with $1–2 billion in excess capital allocation capacity, positions Enbridge for continued opportunistic growth investments while maintaining its 30-year streak of dividend growth.
Is the TSX dividend stock undervalued?
Enbridge’s cash flows are durable, which has enabled the energy giant to increase its dividend every year since 1995. Over the last 10 years, Enbridge has increased its annual dividend per share from $1.86 in 2015 to $3.66 in 2024. Analysts tracking the TSX dividend stock forecast the payout to rise to $4.17 per share in 2029, indicating an annual growth rate of 2.6%.
Moreover, Bay Street estimates adjusted earnings to grow from $2.80 per share in 2024 to $4.03 per share in 2029. Today, ENB stock trades at a forward price-to-earnings multiple of 21 times, which is higher than its 10-year average of 19.3 times.
If ENB stock is priced at 19 times forward earnings, it will trade around $77 per share in early 2029, indicating an upside potential of 28% from current levels. After adjusting for dividends, cumulative returns could be closer to 50% in the next four years.
