Critical Review: Enbridge (ENB) versus Its Rivals
Enbridge (NYSE: ENB) is one of 53 public companies in the “Oil & Gas Transportation Services” industry, but how does it contrast to its peers? We will compare Enbridge to similar businesses based on the strength of its earnings, dividends, analyst recommendations, valuation, risk, institutional ownership and profitability.
Enbridge pays an annual dividend of $1.97 per share and has a dividend yield of 4.8%. Enbridge pays out 191.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Oil & Gas Transportation Services” companies pay a dividend yield of 6.4% and pay out 172.0% of their earnings in the form of a dividend. Enbridge has increased its dividend for 5 consecutive years. Enbridge lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.
Valuation & Earnings
This table compares Enbridge and its peers gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Enbridge||$32.98 billion||$6.11 billion||39.92|
|Enbridge Competitors||$5.66 billion||$1.31 billion||38.23|
Enbridge has higher revenue and earnings than its peers. Enbridge is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.
Institutional & Insider Ownership
61.6% of Enbridge shares are owned by institutional investors. Comparatively, 57.2% of shares of all “Oil & Gas Transportation Services” companies are owned by institutional investors. 9.3% of shares of all “Oil & Gas Transportation Services” companies are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Volatility & Risk
Enbridge has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500. Comparatively, Enbridge’s peers have a beta of 1.39, meaning that their average stock price is 39% more volatile than the S&P 500.
This table compares Enbridge and its peers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of current ratings and price targets for Enbridge and its peers, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Enbridge currently has a consensus target price of $56.00, indicating a potential upside of 36.19%. As a group, “Oil & Gas Transportation Services” companies have a potential upside of 16.98%. Given Enbridge’s higher probable upside, equities analysts plainly believe Enbridge is more favorable than its peers.
Enbridge peers beat Enbridge on 11 of the 15 factors compared.
Enbridge Inc. is a Canada-based energy transportation and distribution company. The Company is engaged in delivering energy. It operates through five segments: Liquids Pipelines, Gas Distribution, Gas Pipelines and Processing, Green Power and Transmission, and Energy Services. Liquids Pipelines consists of common carrier and contract crude oil, natural gas liquids (NGL), and refined products pipelines and terminals, including Canadian Mainline, Lakehead Pipeline System, Mid-Continent and Gulf Coast and Regional Oil Sands System. Gas Distribution consists of its natural gas utility operations, the core of which is Enbridge Gas Distribution Inc. Green Power and Transmission consists of its investments in renewable energy assets and transmission facilities. Renewable energy assets consist of wind, solar, geothermal and waste heat recovery facilities in Canada. Energy Services undertake physical commodity marketing activity and logistical services, and oversee refinery supply services.
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