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Enbridge (NYSE: ENB) is one of the most sustainable dividend shares in the energy sector. The Canadian pipeline and utility company has paid dividends to its investors for more than 69 years. It has increased its payment over the past 29 years in a row. That is impressive, given that all volatility in the energy sector over the years.
The energy company has a lot of fuel to continue to pay dividends. Immediately dividend yield Above 6.5% and more growth ahead, it is an excellent option for those who have a terribly Bankable income flow.
Enbridge has four core franchises: Liquids pipelines that make up 50% of its adapted EBITDA; Gastransmission and midstream, 25%; Gas distribution and storage, 22%; And renewable power, 3%. They offer the company of terribly Predictable income supported by cost-of-service agreements and long-term contracts, in total accounting for 98% of his EBITDA. That predictability has been completely visible in the last 18 years. Enbridge has achieved its financial guidance every year despite two major recessions and two Extra periods of turbulence of the oil market.
The pipeline And utilities Company pays 60% to 70% of the stable cash flow in dividends every year. That is a conservative payment ratio for a company with such stable Cash flow. It gives Enbridge sufficient room for errors, while the company can retain a meaningful cash flow to finance expansion projects and bolt-on-acquisitions.
Enbridge also has a Rock-Solid Financial Foundation. Thanks to the strategy of using long -term, fixed interest debts and the retention of his lever ratio Low, it has a creditworthiness of investment quality. It ended the second quarter with a 4.7 lever ratio, that was In the middle of its 4.5-to-5.0 target range. It sees its lever ratio trending in the direction of the bottom of that reach next year, because it records the full benefits of his recent acquisitions of natural gas use and retains its current capital expenditure range.
These functions put the high -productive dividend of Enbridge on a very sustainable basis. It generates sufficient free cash flow after the dividend to finance a considerable part of the secure capital program. In the meantime, it has the balance capacity to finance the rest with space. This offers extra flexibility to take advantage of future growth opportunities as soon as they arise.
Enbridge finished in the second quarter with $ 24 billion Canadian ($ 17.8 billion) in secure capital projects in its backlog. These projects include extensions of the oil terminal, new gas pipelines, extensions of natural gas and projects for renewable energy. The company expects these projects to enter the commercial service until 2028. That offers Enbridge enormous visibility in its future growth.
