Enbridge (TSX:ENB) stock has quietly lost about 8% over the past two months amid market volatility, but I don’t think that recent slide tells us much about where the shares could go from here. The business itself is performing well.
In the latest quarter, its cash from operating activities jumped, adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) edged higher, and the company added to a secured project backlog that now sits at roughly $41 billion. Meanwhile, investors buying today are collecting a dividend yield of over 5% while many of those projects move toward completion.
I’m not expecting explosive growth from Enbridge, but management’s roughly 5% annual growth targets beyond 2026 could provide enough momentum to lift the stock gradually while maintaining its strong income appeal.
Let me explain where I think Enbridge stock is headed and what could drive its returns over the next few years.
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Enbridge stock
Its recent pullback may look disappointing, but Enbridge’s underlying business strength gives me a big reason to focus on its longer-term direction.
To put it simply, Calgary-based Enbridge operates oil and liquids pipelines, natural gas transmission assets, regulated gas utilities, and renewable power projects. ENB stock currently trades at $72.40 per share with a market cap of $158.2 billion. Its shares have gained around 12% over the last year, even after falling roughly 8% over the past two months.
Income has always been another important part of Enbridge’s investment appeal. At its current market price, it offers a 5.3% annualized dividend yield, with quarterly payouts.
What could be behind ENB stock’s recent weakness?
ENB stock’s recent weakness largely contrasts with its fairly stable second quarter. During the quarter, the Canadian energy infrastructure giant’s adjusted EBITDA climbed nearly 3% year over year (YoY) to about $4.8 billion. Higher revenues related to rate cases at East Tennessee, Texas Eastern, and Enbridge Gas Utah helped drive that improvement.
Its cash generation was even stronger. The business produced about $4.1 billion in cash from operating activities in the latest quarter, up roughly 27% YoY. Similarly, its distributable cash flow also rose nearly 2% to about $2.9 billion.
However, Enbridge’s adjusted quarterly earnings fell about 3% YoY to $1.4 billion. Higher interest expenses from incremental debt issuances and increased depreciation from assets placed into service since the second quarter of 2025 weighed on its bottom line, which could be the main factor hurting investor sentiment and driving its share price lower lately.
Why the growth backlog matters
For me, the strongest argument for where Enbridge stock could head in the next few years comes from the company’s expanding growth pipeline rather than any single quarter.
The company finished the second quarter with a secured growth backlog of approximately $41 billion after adding more than $1 billion through the Line 5 Relocation project. It now expects its annual growth investment capacity to remain between $10 billion and $11 billion.
Adding to the optimism, Enbridge has sanctioned and started construction on the US$1 billion Line 5 Relocation project in Wisconsin, which is expected to enter service in early 2027. Another major project already underway for Enbridge is the $4 billion Sunrise Expansion of its British Columbia Pipeline system.
The Canadian firm recently reaffirmed its 2026 guidance. Beyond 2026, it continues to target an average compound annual growth rate of about 5% for adjusted EBITDA, distributable cash flow per share, and earnings per share.
These are some of the key reasons why I see the recent share-price weakness in Enbridge stock as more of a short-term setback than a change in its broader investment outlook.
