A High-Yield Energy Stock to Think About
In this day and age, not every income investor feels
comfortable putting their money in the energy sector. After all, the price of
energy commodities often goes on a roller-coaster ride. And since income
investors tend to be risk-averse, that kind of volatility isn’t exactly
appealing.
Still, there are energy stocks worth considering, even for
the risk-averse income investor.
For instance, in November 2020, I told readers to consider
Enbridge Inc (NYSE:ENB). I wrote, “If an investor purchases Enbridge stock
today, there’s a good chance they will earn higher yield on cost in the years
ahead.”
As it turns out, investors didn’t have to wait very long to
earn a higher yield on cost.
On December 8, Enbridge declared a quarterly cash dividend
of CA$0.835 per share, representing a 3.1% increase from its prior quarterly
payout of CA$0.81 per share. The new dividend rate went into effect on March 1,
2021. (Source: “Enbridge Announces 2021 Financial Guidance, Increases Dividend,
and Provides Update on Strategic Priorities,” Enbridge Inc, December 8, 2020.)
Better yet, ENB stock also gained some upward momentum. When
I told readers to consider the company, it was trading at $29.08 per share. As
of this writing, Enbridge stock is at $36.70. That’s a gain of more than 26%!
And investors have been collecting bigger dividend checks than before, too.
Of course, that means for investors who didn’t get on board
earlier, the stock is more expensive than before. However, if you look at what
the company has been doing, you’ll see that ENB stock remains one of the best
high-yield energy stocks on the market.
As an energy infrastructure company, Enbridge Inc operates
through four main segments: Liquids Pipelines, Gas Transmission, Gas
Distribution & Storage, and Renewable Power Generation.
Comments
Post a Comment