Enbridge (TSX:ENB) and TC Energy (TSX:TRP) enjoyed strong rallies in the past year. Investors who missed the rebound are wondering if ENB stock or TRP stock is still cheap and good to buy for a self-directed Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP) portfolio focused on dividends and total returns.
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Enbridge stock
Enbridge trades near $61.50 per share at the time of writing. The stock is off its 2025 high near $65, but remains up 25% over the past 12 months.
The company is a giant in the North American energy infrastructure sector with a current market capitalization of nearly $134 billion. Enbridge has the size and financial clout to pursue large acquisitions to drive growth while still making significant investments in its development program. Enbridge broadened its growth strategy in recent years, buying assets in new segments to diversify the revenue stream. The company spent US$14 billion in 2024 to acquire three natural gas utilities in the United States. This followed an acquisition of an oil export terminal in Texas and the purchase of the third-largest American renewable energy developer. Enbridge is also a partner on the Woodfibre liquefied natural gas (LNG) export facility being built in British Columbia.
The $28 billion capital program is spread out across the different operational pillars. Enbridge expects new assets to generate steady earnings and distributable cash flow growth over the next few years. This should support ongoing dividend growth. Enbridge raised the distribution in each of the past 30 years. Investors who buy ENB stock at the current level can get a dividend yield of 6%.
TC Energy
TC Energy spent the past couple of years moving in a different direction than Enbridge, streamlining its operations to focus more on natural gas transmission and storage and power generation. The company spun off its oil pipelines business and monetized some non-core assets as part of its plan to shore up the balance sheet to pursue its capital initiatives. TC Energy plans to invest roughly $6 billion per year over the medium term on capital projects.
The company recently completed two major pipeline projects that will drive revenue growth in 2025.
Coastal GasLink, which delivers natural gas from producers to the new LNG Canada export facility in British Columbia, was a painful endeavour, but is now in operation. The budget more than doubled to about $14.5 billion due to delays through the pandemic, issues with contractors, bad weather and surging material costs.
In Mexico, the story is different. TC Energy completed the 715 km Southern Gateway pipeline in just three years and 13% below budget. The pipeline will supply natural gas from production sites in Mexico to new gas-fired power generation facilities being built to supply electricity for the country.
TC Energy raised its dividend in each of the past 25 years. At the time of writing, the stock provides a dividend yield of 5.1%. The shares trade near $66 compared to the 2025 high of around $71, but are still up 20% in the past 12 months.
Is one a better pick?
Dividend growth will likely be similar at the two companies over the next few years, so income investors might decide to make Enbridge the first choice for the higher yield. Otherwise, I would probably split a new investment between the two stocks at their current prices. Both companies could play major roles in Canada’s new strategy to build energy infrastructure to reduce reliance on energy sales to the United States.
