Can Enbridge Sustain Its 30-Year Dividend Growth Streak?
The average energy company has a dividend yield of around 3.1% today. Enbridge's (NYSE: ENB) dividend yield is materially higher at 5.8%. Should investors be worried that the high yield isn't sustainable?One positive sign is the fact that the North American midstream giant has increased its dividend annually for 30 consecutive years. But that alone doesn't mean the dividend is safe.The energy sector is usually broken down into three broad groups. The upstream (energy production) and the downstream (chemicals and refining) are both highly volatile segments of the industry that are easily affected by commodity prices. Enbridge does not participate in either of those segments. It operates in the midstream. Midstream companies own energy infrastructure, like pipelines, that help to move oil and natural gas around the world.Continue reading
The average energy company has a dividend yield of around 3.1% today. Enbridge's (NYSE: ENB) dividend yield is materially higher at 5.8%. Should investors be worried that the high yield isn't sustainable?
One positive sign is the fact that the North American midstream giant has increased its dividend annually for 30 consecutive years. But that alone doesn't mean the dividend is safe.
The energy sector is usually broken down into three broad groups. The upstream (energy production) and the downstream (chemicals and refining) are both highly volatile segments of the industry that are easily affected by commodity prices. Enbridge does not participate in either of those segments. It operates in the midstream. Midstream companies own energy infrastructure, like pipelines, that help to move oil and natural gas around the world.
