The best dividend stocks out there are best held over the course of many decades. If there’s consistent dividend growth and steady amounts of appreciation (maybe even gains that exceed the TSX Index over time), you might have a dividend gem that’s worth stashing away for life.
With the rise of agentic artificial intelligence (AI), automation, physical AI, quantum computing, and other disruptive technologies, investors should be aware of how such technological trends can affect the growth story of a business as well as the width of its economic moat. At the end of the day, wider moats and better-protected growth profiles mean a whole lot more than a higher yield.
Of course, it would be nice to have both with one name. In this piece, we’ll have a closer look at a name with a respectable yield as well as a good history of dividend growth and share price appreciation. But it’s what’s up ahead that counts, rather than the road that’s now in the rearview mirror. And, in this piece, we’ll look at a name that can be a great hold through almost any sort of market condition.
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Enbridge stock will pay you a lot to wait!
Whether Canada is headed for a recession, stagflation, or a historic economic expansion at the hands of AI, a name like Enbridge (TSX: ENB) looks poised to keep paying out dividends while doing its best to stay resilient in down markets so that it can really thrive in up markets.
Given the rise of AI and quantum computing probably won’t change all too much about how energy is transported across very long distances, Enbridge stands out as a wide-moat firm with a dividend that has staying power. If anything, AI might help a pipeline firm operate more efficiently and far leaner. Combined with the wide legal and physical moat behind Enbridge’s cash cows, I’d say that Enbridge is arguably one of the most comforting dividend names to just buy and forget you own.
As more money is thrown at the next-generation AI data centers, my guess is that gas transmission lines are going to be in even higher demand. What’s more exciting are the windows of opportunity that could open for Enbridge far into the future, especially as the firm gets serious about renewables to further diversify its already impressive mix.
A best-in-breed pipeline that can keep going strong
Any way you look at it, Enbridge is one of the best-in-breed pipeline plays in North America. With a 4.94% dividend yield that could compress further as the bull run in the name continues into the second half, I’d not be afraid to pay a 26.6 times trailing price-to-earnings (P/E) multiple.
With the company recently having inked a deal for work on a solar and energy storage project with one of the great U.S. AI innovators, I think there’s room for serious growth as the hunger for energy really rises and, with that, more similar deals are inked. Given the trajectory of cash flows, I’d argue that some impressive dividend hikes can be expected as the firm extends its streak, enriching investors in the process.
