A 5.3% Yield Pipeline Stock That Could Have a Breakout Year

Shares of Enbridge (TSX:ENB) are now widely owned by the average Canadian investor. If you’ve got exposure to a Canadian stock market index fund, odds are you’re invested enough. That said, if you’re a stock picker, I do think the case for overweighting into the $160 billion pipeline juggernaut is getting a bit stronger over time, and it’s not just about that fat 5.3% dividend yield, which remains quite bountiful, though quite a bit lower than in the recent past (yields closer to 6% were quite common over a year ago).

Indeed, Enbridge might not be the most exciting name to think about buying at a time like this, when semiconductor stocks are melting up, with some names going parabolic, while others seemingly go vertical.

A dividend grower that’s flooring it!

It’s tempting to chase, but unless you’re willing to feel the pain of a proportional move in the opposite direction (a big plunge), I’d be a bit more comfortable going for some of the underrated value plays with huge dividends and very healthy dividend growth prospects. Enbridge fits the bill as a cheap dividend grower that might be worth checking out, even as shares look to consolidate after the latest upward move that began off the lows of January.

With Enbridge stepping up to the plate on Friday to deliver earnings, investors might have a chance to digest the results as they consider stepping in with a longer-term position, even as volatility looks to prevail. Undoubtedly, the stock spiked at Friday’s open, only to spend the rest of the day sinking, ultimately finishing the day down half a percentage point.

On the surface, it was a nice beat on the top- and bottom-line. Add a decent guide into the equation, as well as impressive backlog growth, and the quarter was one that would keep dividend growth investors sleeping well at night.

Enbridge’s quarter was solid despite the initial reaction

Even if the quarter was met with a muted, even slightly negative, reaction, I still think it’ll be tough to stop shares of ENB in their tracks. For the most part, the energy scene has been on the wrong side of the rotation back to the risk-on tech and AI stocks. And while the earnings still surpassed the low bar set by analysts, I do think that there are simply too many interesting things for investors to put their money to work in right now. Though I disagree with the intraday dip, I do think it’s a good thing for investors circling the name, seeking a decent entry point.

While I wouldn’t go as far as to say the earnings are coming for “free,” I do think that the current price of admission is quite decent, especially for long-term thinkers. The backlog is nothing short of encouraging and should help fuel big dividend growth well into the next decade.

The quarter wasn’t perfect, but, for the most part, the name probably should have gotten a shot in the arm. Though a breakout could be tough to time, I must say I like the name a whole lot better after the number than before.

The post A 5.3% Yield Pipeline Stock That Could Have a Breakout Year appeared first on The Motley Fool Canada.

Should you invest $1,000 in Enbridge right now?

Before you buy stock in Enbridge, consider this:

The Motley Fool Canada team has identified what they believe are the top 10 TSX stocks for 2026… and Enbridge wasn’t one of them. The 10 stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 … if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have over $18,000!*

Now, it’s worth noting Stock Advisor Canada’s total average return is 94%* – a market-crushing outperformance compared to 85%* for the S&P/TSX Composite Index. Don’t miss out on our top 10 stocks, available when you join our mailing list!

Get the 10 stocks instantly #start_btn6 { background: #0e6d04 none repeat scroll 0 0; color: #fff; font-size: 1.2em; font-family: 'Montserrat', sans-serif; font-weight: 600; height: auto; line-height: 1.2em; margin: 30px 0; max-width: 350px; text-align: center; width: auto; box-shadow: 0 1px 0 rgba(0, 0, 0, 0.5), 0 1px 0 #fff inset, 0 0 2px rgba(0, 0, 0, 0.2); border-radius: 5px; } #start_btn6 a { color: #fff; display: block; padding: 20px; padding-right:1em; padding-left:1em; } #start_btn6 a:hover { background: #FFE300 none repeat scroll 0 0; color: #000; } @media (max-width: 480px) { div#start_btn6 { font-size:1.1em; max-width: 320px;} } margin_bottom_5 { margin-bottom:5px; } margin_top_10 { margin-top:10px; }

* Returns as of April 20th, 2026

More reading

• Got $25,000? Transform a TFSA Into a Cash-Gushing Machine
• 2 Safer High-Yield Dividend Stocks for Canadian Retirees
• Suncor, Enbridge, or Canadian Natural: Here’s Which Oil Stock Makes Sense for Your Portfolio
• 2 High-Yield Dividend Stocks That Could Be Safer Picks for Canadian Retirees
• 5 Canadian Stocks I’d Feel Good About Holding for 10 Years

Fool contributor Joey Frenette has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy.