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Enbridge Hikes 2020 Dividend, Expects Y/Y Higher EBITDA, DCF

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Enbridge Inc. (ENB - Free Report) recently received authorization from the board of directors to hike quarterly dividend for 2020. The new dividend of 81 Canadian cents (or C$3.24 annually) — expected to be paid on Mar 1, 2020 to stockholders of record as of Feb 14, 2020 — will reflect a sequential hike of 9.8%. The raise will lead to a dividend yield of 6.3%.

This move is indicative of the company’s commitment to create value for its shareholders and underlines Enbridge’s confidence in business growth. In fact, 2020 will be the 25th successive year of dividend increase by the leading midstream energy infrastructure provider.

In addition to the news of dividend increment, Enbridge announced that it expects earnings before interest, taxes, depreciation and amortization (EBITDA) of C$13.7 billion for 2020, marginally higher than 2019 expectation of C$13 billion. The increase can be supported by the Line 3 Replacement project, as the Canadian segment of the pipeline commenced service on Dec 1, 2019. It awaits more clarity on the regulatory processes before the project’s U.S. segment comes online.

Distributable cash flow (DCF) per share for 2020 is expected in the range of C$4.50-C$4.80, higher than the 2019 projection within C$4.30-C$4.60. This reflects Enbridge’s efforts in strengthening overall businesses by shedding non-core assets and adding profitable growth projects. Moreover, the company expects DCF per share to increase 5-7% per annum after 2020.

Notably, it recently signed a letter of intent with Enterprise Products Partners L.P. (EPD - Free Report) , another North American midstream player, to develop the deep-water Sea Port Oil Terminal export facility in the U.S. Gulf Coast.

Price Performance

Calgary, Canada-based Enbridge has gained 24.5% year to date compared with 8.7% growth of the industry it belongs to.

Zacks Rank and Other Stocks to Consider

Currently, Enbridge carries a Zacks Rank #2 (Buy). Other top-ranked stocks in the energy sector include Antero Midstream Corporation (AM - Free Report) and Phillips 66 (PSX - Free Report) , each carrying Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Antero Midstream’s bottom line for the current quarter is expected to skyrocket 120% year over year.

Phillips 66’s 2019 earnings per share have witnessed nine upward estimate revisions and no downward movement in the past 60 days.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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