Valued at a market cap of $89 billion, TC Energy (TSX: TRP) is among the largest energy infrastructure companies globally. It moves roughly a quarter of the natural gas used across North America and continues to grow at a steady pace.
Over the last 10 years, the TSX dividend stock has returned 65% to shareholders. However, if we account for dividend reinvestments, cumulative returns are closer to 152%.
So, let’s see if TC Energy stock is a buy, sell, or hold.
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Why TC Energy’s pipelines are a key driver
TC Energy is a toll operator but for natural gas. It owns a network of 93,600 kilometres of pipeline, which supplies more than 30% of the natural gas consumed daily across North America.
TC Energy signs long-term contracts with customers to transport natural gas, allowing it to generate predictable cash flow across market cycles and pay shareholders a dividend yield of 4.2%.
The company also owns a stake in Bruce Power, a nuclear station in Ontario.
In Q2 2026, TC Energy grew comparable EBITDA (earnings before interest, taxes, depreciation, and amortization) by 12% year over year, while gas flows across its network rose 3%.
Bruce Power ran at 99% availability, while Unit 3 also returned to service more than seven months early, at about 15% less cost than Unit 6.
TC Energy now expects to land at the top of its 2026 EBITDA range of $11.6 billion to $11.8 billion. It also maintained its 2028 EBITDA target of $12.6 billion to $13.1 billion.
In 2026, TC Energy has approved about $3 billion in new projects at an expected return near 12% and another $7 billion awaits approval. A further $20 billion sits in early development, and about two-thirds of that is tied to power generation.
Management now sees North American gas demand growing by about 51 billion cubic feet a day by 2035, 40% higher than 2025. Most of the demand is tied to AI data centres, which could unlock a massive revenue stream for TC Energy.
CEO Francois Poirier summed up the message to analysts:
Our confidence is driven not only by the scale of the opportunities we see ahead, but by our ability to consistently execute.
So far, TC Energy says it has delivered most of its recent projects on time and on budget.
The risks that stop TC Energy from being an easy buy
TC Energy is expected to spend heavily on capital expenditures. Between 2026 and 2030, cumulative capex is projected to surpass $31 billion, which should drive future cash flow and dividends higher.
However, Chief Financial Officer Sean O’Donnell said the big step up in growth spending will come in 2029 and 2030. Bruce Power’s major component replacement program does not wrap up until 2031 and 2032, when the last two units finish. O’Donnell said that will free up another $2 billion to $3 billion a year for new projects.
It also leaves a possible funding gap of two or three years. Management says it has options, including selling assets or tapping the capital markets. But raising money can dilute shareholders.
TC Energy targets leverage of 4.8 times debt to EBITDA, which means an increase in interest rates will impact profit margins.
So, is TC Energy stock a buy, sell, or hold?
Analyst estimates compiled by TIKR project adjusted FFO (funds flow from operations) to expand from $6.56 per share in 2026 to $9.63 per share. Given an annual dividend of $3.51 per share, TC Energy has a payout ratio of less than 54% this year.
If the Canadian dividend stock is priced at 12 times forward earnings, it could return 35% within the next 40 months. If we account for dividends, cumulative returns should be closer to 50%.
The business is executing well, and the backlog is growing. Moreover, the dividend rose about 3% this year. TC Energy remains a top stock to own for those looking for a growing dividend base and steady capital appreciation.
