Enbridge Received its Third Buy in a Row

By Jason Carr

Analysts seem to be optimistic about Enbridge (TSX: ENB) lately as another research firm gave the stock a Buy rating today. Analyst David Galison from Canaccord Genuity rated Enbridge (TSX: ENB) a Buy, setting a C$63 price target.

Galison said:

“Date and time of first dissemination: May 30, 2017, 08:27 ET Date and time of production: May 30, 2017, 08:27 ET Target Price / Valuation Methodology: Enbridge Inc. – ENB Our C$63.00 price target represents 13.9x our 2019E EBITDA outlook. Risks to achieving Target Price / Valuation: Enbridge Inc. – ENB Enbridge Inc. faces the following risks: Counter Party (Credit) Risk: Counterparty credit risk represents the financial loss Enbridge could experience if a counterparty to a financial instrument failed to meet its contractual obligations in accordance with the agreed terms and conditions; Foreign Exchange Risk: Variations in the exchange rate for the Canadian dollar versus the U.S.”

According to TipRanks.com, Galison is a 4-star analyst with an average return of 7.4% and a 66.7% success rate. Galison covers the Basic Materials sector, focusing on stocks such as Inter Pipeline Ltd, Concho Resources, and Pembina Pipeline.

Currently, the analyst consensus on Enbridge is Strong Buy and the average price target is C$65, representing a 24.0% upside.

In a report released yesterday, RBC Capital also reiterated a Buy rating on the stock with a C$67 price target.

Based on Enbridge’s latest earnings report for the quarter ending March 31, the company posted quarterly revenue of C$10.82 billion and quarterly net profit of C$721 million. In comparison, last year the company earned revenue of C$8.46 billion and had a net profit of C$1.29 billion.

Enbridge, Inc. engages in the provision of gas and oil businesses. It operates through the following segments: Liquid pipelines, gas distribution, gas pipelines processing and energy services, sponsored investments, and corporate. The Liquids Pipelines segment consists of common carrier and contract crude oil, natural gas liquids and refined products pipelines and terminals in Canada and U.S., including Canadian Mainline, Regional Oil Sands System, Southern Lights Pipeline, Spearhead Pipeline, Seaway Crude Pipeline interest and other feeder pipelines. The Gas Distribution segment consists of the company’s natural gas utility operations which serve residential, commercial and industrial customers, primarily in central and eastern Ontario as well as northern New York State. The Gas Pipelines, Processing and Energy Services segment consists of investments in natural gas pipelines, processing and green energy projects, the company’s commodity marketing businesses and international activities. The Sponsored Investments segment includes the company’s ownership interest in Enbridge Energy Partners LP, Alberta Clipper Project and Enbridge Income Fund. The Corporate segment consists of the company’s investment in Noverco, Inc., new business development activities, general corporate investments and financing costs not allocated to the business segments. The company was founded on April 30, 1949 and is headquartered in Calgary, Canada.

The company’s shares closed last Monday at $52.42.