This 6.5%-Yielding Dividend Stock Continues to Add to its Massive Growth Backlog and Has Plenty More Growth Coming Down the Pipeline

Matt DiLallo, The Motley Fool

Thu, Mar 6, 2025, 2:26 AM 5 min read

Enbridge (NYSE: ENB) offers investors a monster income stream. The Canadian pipeline and inferior presently yields 6.5%, which is respective times higher than the S&P 500's 1.3% yield.

That lucrative income watercourse is lone portion of the draw. Enbridge besides has a monolithic backlog of enlargement projects to substance its maturation for respective years. Add that maturation to its income stream, and Enbridge could nutrient a almighty full instrumentality successful the coming years, making it a large semipermanent concern opportunity.

Enbridge precocious updated investors connected its maturation prospects. The vigor infrastructure elephantine noted that it has present secured $20 cardinal (in U.S. dollars) of enlargement projects aft precocious adding different $1.7 cardinal successful accretive caller investments. Those latest additions are:

• Mainline superior investment: Enbridge plans to put up to $1.4 cardinal done 2028 to amended the reliability and ratio of its Mainline lipid pipeline system.

• Birch Grove: The institution approved an further $276 cardinal enlargement of its T-North Pipeline to determination further earthy state supplies. It besides expects to implicit this task successful 2028.

• T15 expansion: It sanctioned a $69 cardinal enlargement of its T15 task to treble the capableness of the state utility enlargement task successful enactment of Duke Energy's Roxboro gas-fired powerfulness plant. T15 should commencement commercialized work successful the 2027 to 2028 timeframe.

Those caller projects further heighten and widen Enbridge's semipermanent maturation outlook. It currently has projects crossed its 4 halfway franchises of liquids pipelines, state transmission, state organisation and storage, and renewables that should participate work done 2029. The institution expects to spot $15.9 cardinal of projects into work done 2027, with the remainder slated to travel online successful 2028 and 2029.

This monolithic enlargement task backlog gives Enbridge tremendous visibility into its maturation prospects. The institution expects to present 7% to 9% maturation successful adjusted net earlier interest, taxes, depreciation, and amortization (EBITDA) done 2026 and 5% annually aft that. Meanwhile, it should present 3% yearly distributable currency flow-per-share maturation done 2026 and 5% beyond adjacent year. This maturation should enactment yearly dividend increases of up to 3% done adjacent year, perchance accelerating to arsenic overmuch arsenic 5% aft 2026. That positions the institution to proceed gathering connected its 3 decades of yearly dividend increases.

Enbridge presently sees plentifulness of opportunities to proceed expanding each of its franchises. CEO Greg Ebel commented connected the company's maturation prospects astatine its caller capitalist day: