Canada is blessed with an abundance of energy stocks that can offer growth and income-earning potential that lasts for years. Among those great picks is one Canadian Energy stock that not only offers growth and income, but also a defensive moat like no other.
That pick is Enbridge (TSX: ENB), and here’s why it belongs in your portfolio.
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Meet Enbridge
Enbridge is one of the largest energy infrastructure companies on the planet. The company also operates one of the largest and most complex pipeline networks anywhere.
That pipeline network generates the bulk of Enbridge’s revenue, hauling both crude and natural gas across Canada and through the U.S.
In case you’re wondering, Enbridge transports a whopping one-third of all North American-produced crude oil and one-fifth of the natural gas needs of the entire U.S. market across its network.
Another key thing to note is that Enbridge charges for use of that network, and not by the volatile price of the commodity transported. So irrespective of which way oil prices move, Enbridge generates a stable and recurring revenue stream.
To say that this makes Enbridge a top defensive pick would be an understatement. But this incredible Canadian energy stock still offers much more.
Beyond Pipelines: Enbridge’s other income engines
Beyond its pipeline roots, Enbridge is the Canadian energy stock that offers a diversified foray into other segments of the energy market.
Specifically, Enbridge operates a growing renewable energy business. That business, which Enbridge has invested over $12 billion into over the past two decades, comprises an impressive network of facilities in North America and Europe.
Those facilities generate a recurring revenue stream backed by long-term regulated contracts, operating much like a utility business.
Speaking of utilities, that’s the other segment that Enbridge offers as the Canadian energy stock your portfolio needs.
Enbridge operates one of the largest natural gas utilities in North America. This adds yet another reliable and recurring revenue stream into the mix.
Collectively, those segments provide ample revenue for Enbridge to invest in growth from its multi-billion dollar project backlog, while paying one of the best dividends on the market.
Let’s talk dividends
Enbridge offers investors a tasty quarterly dividend. As of the time of writing, that yield works out to an impressive 5.8%. This handily makes Enbridge one of the better-paying dividend stocks on the market.
Adding to that appeal is the fact that Enbridge has provided investors with annual upticks to that dividend going back three decades without fail.
In other words, Enbridge is the Canadian Energy stock for long-term investors to buy now and forget about for a decade or more.
Is Enbridge the Canadian energy stock for you?
No stock is without risk, and that includes Enbridge. But where Enbridge differs from other companies within the energy sector is the sheer breadth of what it offers.
Specifically, the company has one of the best defensive moats on the market, caters to both oil and renewable energy segments, and has amassed three decades of consecutive annual increases.
In short, Enbridge is the stock to own in any well-diversified portfolio.
