With demand for natural gas continuing to grow across North America, there’s no question that TC Energy (TSX: TRP) is a stock many Canadians will have on their radar in the final months of 2026.
That’s because even though its existing pipeline network already generates billions of dollars in relatively predictable cash flow, investors understand that its existing infrastructure also gives it opportunities to expand as energy needs grow.
And those opportunities are becoming even more significant as liquefied natural gas (LNG) exports increase and power providers need additional natural gas to keep up with rising electricity demand, particularly from data centres.
In fact, TC Energy recently announced another $3 billion of growth projects, raised its financial outlook for 2026 and introduced a five-year growth forecast through 2031.
However, with the stock up roughly 20% over the last year and its dividend yield now below 4%, investors have to consider whether those opportunities actually make the stock worth buying at today’s price.
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Why the infrastructure stock still has years of growth ahead
One of TC Energy’s biggest advantages is the massive natural gas pipeline network it already owns across Canada, the United States and Mexico.
Pipelines are some of the best infrastructure assets investors can own because they’re so difficult to build and replace. Between the upfront costs, securing land rights and obtaining regulatory approvals, established operators have significant competitive advantages.
Plus, rather than producing natural gas and relying on commodity prices, TC Energy earns most of its money transporting it through infrastructure that utilities, power generators and other customers depend on.
In fact, roughly 98% of the company’s comparable earnings before interest, taxes, depreciation and amortization (EBITDA) comes from regulated assets or long-term take-or-pay contracts, making much of its earnings relatively predictable.
And as demand increases, TC Energy can often expand existing pipelines instead of building entirely new systems, allowing it to increase capacity while benefiting from its established infrastructure.
For example, its newly approved Crossroads Expansion project will add capacity to serve growing demand from power generators, including data centres, in the U.S. Midwest. The roughly US$1.8 billion project is backed by long-term contracts and is expected to enter service in 2030.
That’s just one example of how TC Energy can keep growing. In fact, it now has nearly $25 billion in sanctioned projects that should contribute to earnings as they enter service.
Furthermore, after generating roughly $11 billion in comparable EBITDA in 2025, TC Energy now expects between $11.8 billion and $12 billion in 2026. Management is also forecasting average annual EBITDA growth of 5% to 7% through 2031.
Is TC Energy stock a buy, sell or hold today?
There’s no question TC Energy is a high-quality business with plenty of long-term potential. However, whether it’s worth buying in late 2026 is another story.
Its ability to consistently generate cash flow is also crucial for supporting its dividend, especially when you consider that TC Energy has now increased its dividend for 26 consecutive years.
And while the stock currently yields roughly 3.9% after its recent performance, management expects annual dividend growth of 3% to 5%.
So, although the yield isn’t as high as that of some other Canadian pipeline stocks, TC Energy still offers an appealing combination of reliable income and long-term growth.
The issue, though, is what you’re paying for that business today.
With shares trading around $90 after rising roughly 20% over the last year, TC Energy is valued at nearly 24 times expected earnings. That’s significantly higher than its average forward price-to-earnings ratio of roughly 16.8 times over the past decade.
Plus, TC Energy still has billions of dollars in capital spending ahead and significant debt on its balance sheet, even though management has kept its debt-to-EBITDA ratio below its long-term target of 4.8 times.
That’s why, in my view, TC Energy looks like a hold at today’s price. There’s no question it’s a high-quality company with plenty of long-term potential, and I certainly wouldn’t be rushing to sell shares. However, with the stock trading at such a significant premium to its historical valuation, I wouldn’t be rushing to buy more either.
