is enbridge dividend safe

You’ll soon read about proven strategies that will enable you to generate income and build the future you want. Last Updated on May 27, 2020. We previously reviewed these issues and do not expect them to affect Enbridge's dividend safety profile, even if Line 3 were to be scrapped. The COVID-19 pandemic has hammered energy stocks, and today Enbridge stock sports a distribution yield of 7.4%.So Enbridge Inc’s 50% payout ratio sits well within my comfort zone.That said, Enbridge has held up better than most.For full-year 2020, management expects the business to generate between $4.50 and $4.80 per share in distributable cash flow. Over the same period, analysts project that the business will pay out $2.35 per share in distributions.Moreover, Enbridge’s diversified business has really paid off. Two-thirds of Canada’s oil and 20% of the United States’ natural gas travel through Enbridge’s pipelines.The slowdown will certainly impact the demand for oil and gas. But with that said, the dividend safety metrics have deteriorated since 2016 due to the large number of shares issued for the merger with Spectra and some inconsistent results.

For unhealthy companies, the virus will be the excuse to cut.But even if CAD dropped by CA$2.5 billion, the company would still bring in enough cash to afford its dividend.Marc Lichtenfeld has studied the markets for more than 22 years. That bodes well for the company’s existing infrastructure.There’s just one problem. Enbridge Inc. (ENB) Dividend Safety metrics. These earnings should be stable no matter what happens to the underlying energy market. The issue is more over the long term, as struggling energy companies simply can’t afford to pay their bills. Three standout dividend stocks in the sector are Enbridge ... A safe dividend powered by clean energy. That comes out to $2.26 in U.S. dollars and equals an impressive 8.8% yield. This year, the company is forecast to generate CA$9.42 billion.Marc’s top-notch research makes him a sought-after media guest. And with fewer barrels coming out of the ground, pipeline owners have seen their fee income dry up.But could that tradition come to an end? I doubt it.Not to alarm you, but you’re about to miss an important event.Remember, Enbridge has been dealing with a weak energy market for years now, and it has been weathering that storm just fine.

Enbridge has increased its annual dividend each year since 1995. That leaves executives with some wiggle room in the event of a downturn, like the one we’re in right now.Altogether, this means Enbridge Inc still pulls in enough cash to fund its distribution.This is an entirely free service. Click on image above to view larger graph We have a consistent track record of delivering annual dividend increases, and our continuing goal is to deliver superior shareholder returns through capital appreciation and dividends. This means customers have to pay Enbridge regardless of whether they use the pipeline. Get access to all of the retirement secrets and income strategies from our experts!Marc Lichtenfeld has studied the markets for more than 22 years. That could lead to slower volumes of oil and gas going through Enbridge’s pipelines, which would impact the company’s revenue and cash flow.But Enbridge has plenty of room before CAD drops below what the company pays shareholders.Enbridge’s CAD has been steadily rising. New projects and price increases will help drive earnings growth, too. This translates into $3.24 dividend per share on an annualized basis for 2020. Finally, investors should also note that Enbridge's stock price is correlated to oil prices, even if its cash flow is not.

While its dividend is appealing today and the company is still producing strong results today, I wouldn’t rely on its dividend for the long term given all the uncertainty that exists today, especially considering the size of the payments that Enbridge is making. It projected distributable cash flow of between $4.50 and $4.80 per share for 2020. Generally, I like to see companies pay out less than 90% of their cash flow as dividends. It has raised its dividend, even as oil producers slashed and eliminated theirs. The big question dividend investors are likely wondering is if the stock’s dividend payments are safe. You can opt-out at anytime.Admittedly, the energy business is in a bit of a funk. Enbridge has paid dividends for over 65 years to its shareholders. Its current dividend is $3.24 per share. The company is also a popular dividend growth stock since it is a Dividend Contender having raised the dividend for 24 consecutive years.

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