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This Pipeline Stock Has Raised Its Dividend for 31 Straight Years. Almost Nobody Talks About It.

The Motley Fool · 1d ago

Key Points

  • Enbridge has raised its dividend annually for more than three decades.

  • That consistently makes it a more stable pipeline play than its industry peers.

Enbridge (NYSE: ENB), the Canadian midstream company that operates over 70,000 miles of pipelines and smaller feeder lines in North America, usually doesn't attract as much attention as U.S. pipeline operators like Kinder Morgan (NYSE: KMI) and Energy Transfer (NYSE: ET).

However, Enbridge has raised its dividend annually for 31 consecutive years. By comparison, Kinder Morgan and Energy Transfer have only raised their payouts annually for nine and four consecutive years, respectively. Enbridge also pays a high forward yield of 5.6%.

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Pipelines placed on a stock chart.

Image source: Getty Images.

Why should you pay more attention to Enbridge?

As a midstream pipeline operator, Enbridge is well-insulated from volatile commodity prices because it simply charges upstream and downstream companies "tolls" to use its infrastructure. That business model generates plenty of cash, which it consistently returns to its investors.

From 2021 to 2025, Enbridge's distributable cash flow (DCF) per share increased from $4.96 CAD to $5.71 CAD ($4.13). For 2026, it expects that figure to rise to $5.70-$6.10 CAD per share, which will easily cover its forward dividend rate of $3.88 CAD ($2.81) per share.

Enbridge's stock still looks reasonably valued at 21 times forward earnings. Its scale, diversification, and the multi-decade durability of its dividend all indicate it's a great long-term play for income investors -- regardless of where oil and gas prices go from here.

Leo Sun has positions in Energy Transfer. The Motley Fool has positions in and recommends Enbridge and Kinder Morgan. The Motley Fool has a disclosure policy.