Is Enbridge a better ultra-high 2-time dividend stock to buy now than energy transfer?
Mid-class energy stocks have been anything other than mid-class performers recently. Please take a look Enbridge (NYSE:ENB) and Energy Transfer LP (NYSE:ET). These two major midstream stocks have skyrocketed at 33% and 42% for the past 12 months, respectively.
However, just because they were big winners in the past doesn’t necessarily mean that they stay on top. Is Enbridge a better ultra-high 2-time dividend stock to buy now than energy transfer? Here’s how to compare the two strains:
The business models of Enbridge and Energy Transfer are similar in several ways. Both have extensive pipeline networks in North America.
Perhaps the main differentiator with midstream operations is that Enbridge’s pipeline is in Canada and the US, whereas it is only understood by Canadian companies that are able to understand the pipeline of energy transfer. is based in the US
Another important difference between the two companies is that Enbridge is more diverse. Thanks to the acquisition, which was completed in 2023, it is now ranked as North America’s largest natural gas utility company.
Perhaps the most important overall way these businesses differ is at different sizes. Enbridge’s market capitalization is approximately $99 billion. The company generates more than 6 billion adjusted revenue in Canadian dollars and is decentralized. Cash flow Of almost $12 billion last year.
Energy transfer market capitalization is significantly lower at nearly $68 billion. Midstream operators’ revenues for 2024 were $1.08 billion, as were their $1.98 billion distributable cash flow.
The Enbridge project adjusts revenues with interest, tax, depreciation, and revenues adjusted before amortization (ebitda) in 2025 it would be between $19.4 billion and $2 billion. This reflects year-over-year growth of nearly 17% at the midpoint of the range.
In energy transfer, a coordinated EBITDA is expected to be between $16.1 billion and $16.5 billion this year. The midpoint of this guidance range reflects an increase of approximately 5% year-on-year.
Could potential tariffs on Canadian imports into the US affect Enbridge’s business? Perhaps, but I don’t think the effect will be important. In the long run, the growth outlook for these two companies must be similar as they face many of the dynamics and opportunities of the same industry.
Enbridge and Energy Transfer offer a particularly juicy dividend/distribution. However, Enbridge’s 6.05% forward dividend yield is lower than the 6.58% forward distribution yield for energy transfer.