Enbridge (Symbol-ENB)..are we getting close to a buy???

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Arby
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by Arby »

According to a CIBC report, the spike in trading may be related to arbitrage and index rebalancing.
Having received regulatory clearance from the Canadian Competition Bureau, Enbridge's merger with Spectra Energy has closed. We continue to be buyers into any volatility related to arbitrage and index rebalancing activity and would remain a shareholder while the cash flow story plays out to our satisfaction
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by Taggart »

Putting Enbridge's bad day into perspective

Saturday, November 4, 2017
JOHN HEINZL

Why did Enbridge's shares get hammered this week?

Sometimes, it's not what a company says, but what it doesn't say, that gives investors fits.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by Thegipper »

I own this stock. My concern is the amount of debt they have accumulated. Last time I looked it was in the 45 billion range. May-be this is a factor weighting in on this stock?
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by Londoncalling »

Lots of interest in this stock as of late. I put in an order on Friday but it didn't quite get low enough to trigger. I expect some downward pressure before the end of 2017. IMO short term trouble but good opportunity for the long run.

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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by shellybear »

yes i think lower could happen, as we know tis the season... tax loss selling season that is.
Unfortunately it creates a snowball action as stops get taken out, and many decide to offset their gains , tax-wise, by dumping a big loser.
The great thing about this ... it creates a big buying opportunity. My favorite time of the year to buy beaten up stocks... is December.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by thedude99 »

Long time holder here.

Bit concerning that they didn't re-iterate their dividend growth policy as in previous quarters and are stating wait until Enbridge investor day. Their debt is abit concerning but smart debt is OK. I'm still not sold on the Spectra acquisition. Also the general difficulty in getting anything built now is another drag. I'll probably be adding if it gets into the low 40's
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by shellybear »

Not sure this latest dividend move will go over that well. On one hand they are saving some cash, but on the other hand they are diluting the earnings per share by a few %. And this is already trading on hard downhill slide, in tax loss season.
Enbridge Energy to issue 2.5457-share Q3 distribution



2017-11-06 17:19 MT - News Release


Mr. Michael Barnes reports

ENBRIDGE ENERGY MANAGEMENT, L.L.C. CONFIRMS AMOUNT OF SHARE DISTRIBUTION FOR THIRD QUARTER 2017

Enbridge Inc.'s Enbridge Energy Management LLC has confirmed that its previously declared share distribution, to be paid on Nov. 14, 2017, will consist of 2.5457 additional shares for each 100 shares of record on Nov. 7, 2017.

The distribution of additional Enbridge Energy Management shares is based on the notional cash value of the declared distribution of 35 cents per share and the average closing price of Enbridge Energy Management shares for the 10 consecutive trading days prior to the ex dividend date.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by Shakespeare »

This is the L.L.C., not the main company.
Sic transit gloria mundi. Tuesday is usually worse. - Robert A. Heinlein, Starman Jones
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by shellybear »

Oops my bad, i see that now EEM not ENB...
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by shellybear »

I am still pondering catching the falling knife here. December after tax -loss selling abates, may be the right timing...
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by AltaRed »

Maybe we are getting to the frothy top of this long bull market. I have noticed that stocks which have been in a downward trend are continuing to go down, i.e. any excuse to sell. That is a sign I have seen before.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by Londoncalling »

As noted in the buy thread I started a position today in ENB in my RRSP account. Will look at some other options for some buys before year end.

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Re: What did you Buy? What might you buy? (2017)

Post by thedude99 »

On several forums I follow ENB seems like a popular pick these days. I've owned it since 2006 and have no plans to sell, however no plans to add. Their debt load is abit worrying, however it's OK at a certain growth rate. I'm not sure where those two intersect.

Could this end up being like Kinder Morgan whereby it got so debt loaded that it eventually blew up for lack of a better term?
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Re: What did you Buy? What might you buy? (2017)

Post by Subby »

thedude99 wrote: 10 Nov 2017 22:28
Could this end up being like Kinder Morgan whereby it got so debt loaded that it eventually blew up for lack of a better term?
I haven’t added for the same reasons you’ve mentioned. I’d like a bit more clarity on what their near to mid term expectations look like. KMI dug in their heels and maintained their position on growing their dividend right up until the point it was cut by 75% Don’t think investors will easily forget it.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by JaydoubleU »

There's a discussion on Enbridge growing on the buy thread, which I think should be moved here:
thedude99 wrote: ↑Fri Nov 10, 2017 11:28 pm

Could this end up being like Kinder Morgan whereby it got so debt loaded that it eventually blew up for lack of a better term?
I haven’t added for the same reasons you’ve mentioned. I’d like a bit more clarity on what their near to mid term expectations look like. KMI dug in their heels and maintained their position on growing their dividend right up until the point it was cut by 75% Don’t think investors will easily forget it.
Enbridge could easily lower that dividend growth target a notch and it wouldn't upset me: 8% a year to 2024 would still be sweet. Managing the debt should be the number one priority. Asset sales or dropdowns also remain options, as Shakespeare said.
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Re: What did you Buy? What might you buy? (2017)

Post by Spidey »

Going by TD reports, ENB's debt to capital is pretty consistent with the industry average. A large part of their business should be reasonably stable - I anticipate them supplying natural gas to my house for the next couple of decades at least. Beta is 0.62. The dividend payout ratio appears stretched and this is a bit of a concern but it is under the industry average. For me it boils down to there not appearing to be any "slam dunks" out there (even the indexes look toppy) and recently most of our savings have been going into cash. However, it came down to the decision of how much I wanted to sitting in cash and losing money after inflation or to start to deploying some into what appears to be reasonably reliable dividend payer. I'm more comfortable investing during severe market downturns than in this type of market - It's a very tough market for decision making.

Moved some posts starting here from What Did You Buy thread. Order of posts a bit off due to posted times.
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Re: What did you Buy? What might you buy? (2017)

Post by AltaRed »

ENB investors may be starting to look at ROE and ROA (Return on Assets) in addition to the usual suspects. Those ratios are rather dismal... low single digit on both counts relative to 5-10 years ago. ROE circa 5-6%, ROA circa 2-3% which in my mind says they have invested both debt and secondary equity offerings poorly over the last 5 years. IMO, their obsession with dividend growth is undermining their core business and impacting their balance sheet. They need to stop spending money like drunken sailors. That said, I don't have any wisdom on how the Spectra acquisition will affect those metrics going forward.

Disclosure: I still hold a full position after having taken profits some years ago. I wouldn't overweight this one though given recent management behaviour in the last few years.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by nisser »

I thought of the same. I bought some ENB at ~50$ but I'm wondering if anyone can see similarities with kinder morgan?
I initially thought that the drop was due to a rotation into higher leveraged OnG stocks from the "safer" ones and a result of rates going up.
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Re: What did you Buy? What might you buy? (2017)

Post by brad911 »

And with reference to rising interest rates the yield has room to go up based on historical data. I'm at a full position with no intention on adding at these levels.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by StuBee »

Well, I guess I have no choice but to say my two cents worth...

As some are aware, I have (or had) a prolonged love affair with ENB. It has been very good to me but has been going more or less no where in the last two or three years. In spite of this, the dividend keeps on rising.

I find an in excess of 5% yield worrisome. In comparison, TRP is only yielding 4% (and for quite a long time, their yield was in excess of Enbridge's...)

Fortunately I have unloaded progressively more than 1/2 of my ENB since 2012 (2012 at 37$, 2014 at 45$ and 2016 at 51$). On a variety of occasions, documented on this thread and others, I have regretted my sales. I am far less regretful today. In the past, ENB represented 15% of total portfolio. Today it represents 5%.

I will be quite content if, going forward, they limited their dividend growth to less than 10% or even 5%. I cannot imagine them cutting their dividend but if this were to happen, I could (now) handle it.

Unfortunately, IMHO, as a growth industry there is no future for pipelines. I would not be at all surprised if many of ENB's "Backlog" do not come into service. There is simply far too much resistance on the one hand and an absence of political will on the other hand.

All this being said, if any major projects do actually come on line this would be quite the catalyst for this stock. Also, this time of year is not the best time to judge what the market considers to be an appropriate evaluation of one of this years "losers".

For now, I am going to sit tight.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by JaydoubleU »

as a growth industry there is no future for pipelines. I would not be at all surprised if many of ENB's "Backlog" do not come into service. There is simply far too much resistance on the one hand and an absence of political will on the other hand.
That is indeed another headwind, which is one reason why I have been supportive of their diversification into renewable projects, where there is a lot of public support and government money pouring in. But I find the resistance to pipeline building incredibly hypocritical on the parts of some people. The roads are clogged with cars, and where do people think the fuel comes from? A close and dear relative, for one, is strongly opposed to any pipeline building, but she drives her car everywhere as if there was no connection between the two. And last I checked, no one is protesting the gas coming in to heat the house; I for one am rather grateful for it right now.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by AltaRed »

Just remember ENB's foray into renewable would have to be massive (in the bllions) to move the needle. Dicking around with hundreds of millions doesn't do anything materially to their metrics.

My take is they will have their moments in the sun in the future, in other countries away from the 'tree huggers' if necessary, but their valuations will need to be more earthbound and competitive with say, the banks, and telecoms.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by StuBee »

JaydoubleU wrote: 11 Nov 2017 14:58That is indeed another headwind, which is one reason why I have been supportive of their diversification into renewable projects, where there is a lot of public support and government money pouring in.
While I do applaud Enbridge's move at this level, I question it's profitability. Others know far more than I do but it is my understanding that the ROI on renewables is far less than what Enbridge's core buisness enjoys...

<Rant>
I am far from impressed by the treatment that KM's Transmountain Pipeline is receiving. Our current government has approved it and yet is not in any way supporting it. Why is it that those with the proper authority do not get up and say: "Look people, this project has been approved and it will happen, go find something else to do".
<end Rant>

NB. I do not own KM...
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by AltaRed »

At slight? risk of going off-topic, my view is the dilemma with Trans Mountain is the delicate balance between federal politicians (and possibly NEB) using more pressure on Burnaby, and a risk of the result of pressure being challenged in the courts. OTOH, my response has been that smart organizations have (should have) Plan B and Plan C ready to go to counter such maverick behaviour and while IANAL, there must be a legal way to challenge 'frustration of contract' in the courts.
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Re: Enbridge (Symbol-ENB)..are we getting close to a buy???

Post by JaydoubleU »

Yes, I can appreciate that Enbridge can't simply throw up a few windmills and change the business model overnight. I only meant that it seems a good idea to diversify and be a major part of a new and rapidly growing sector.

My parent's recently switched from an oil furnace to an electric system. They commented that they would have considered natural gas had a pipeline been available, but there is none (a suburb of Montreal). Why isn't Enbridge there?

I doubt very much that in the coming decades demand for energy is going to decrease. ENB simply needs to find new ways to get its market share. But I'm quite sure management knows more about the energy markets than I do.

Nor does there seem to be a shortage of projects: http://www.enbridge.com/projects-and-in ... e/projects
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