Saturday, January 7, 2017

Dividend Increase

       Enbridge is known for raising its dividend shortly after the Dec 1 dividend payment. This year Enbridge decided to not raise the divided until January.  This was due to the vote on the acquisition of Spectra Energy in the United States. The investors of these 2 companies voted in favor the acquisition.

Enbridge Inc. operates as an energy transportation and distribution company in the United States and Canada. Its Liquids Pipelines segment operates common carrier and contract crude oil, natural gas liquids (NGL), and refined products pipelines and terminals. The company'’s Gas Distribution segment operates as a natural gas utility that serves residential, commercial, and industrial customers in Central and Eastern Ontario, and Northern New York State, as well as in Quebec and New Brunswick. Its Gas Pipelines, Processing and Energy Services segment has interests in natural gas pipelines, including the Vector Pipeline and transmission and gathering pipelines in the Gulf of Mexico, as well as holds an interest in Aux Sable, a natural gas fractionation and extraction facility. This segment is also involved in the renewable energy projects, such as wind, solar, and geothermal projects with a generating capacity of approximately 2,800 MW. The company’s Sponsored Investments segment is involved in renewable and alternative power generation; crude oil and liquid petroleum transportation and storage; and natural gas and NGL gathering, treating, processing, and transportation. Enbridge Inc. has a strategic partnership with EDF Group for the development, construction, and operation of three French offshore wind farms. The company was formerly known as IPL Energy Inc. and changed its name to Enbridge Inc. in October 1998. Enbridge Inc. was founded in 1949 and is headquartered in Calgary, Canada. (Source: Yahoo Finance)


       Late in the afternoon on January 5th, Enbridge announced a 10% dividend increase.  The quarterly dividend payment has been raised from $0.53 per share to $0.583 per share.  This represents an annual dividend rate of $2.332 per share.

      I currently own 48.983 shares of Enbridge across 2 accounts. My annual dividend income will increase $10.38.  I did not have to do anything except be a shareholder of this company. This $10.38 increase is equivalent to investing $296.57 of my own money at a 3.5% yield.

      Enbridge is planning to raise the dividend again upon the completion of Spectra Energy that would represent a total dividend increase of 15% over the dividend rate of 2016. 

Disclosure : Long ENB

DISCLAIMER
I am not a financial planner, financial advisor, accountant or tax attorney. The information on this blog represents my own thoughts and opinions and should NOT be taken as investment or business advice.

Every individual should do their due diligence to make their own financial decisions based on their financial situation and tolerance for risk.



2 comments:

  1. Passive income is always welcome. That is a very nice increase! Like how you explained how much you would need to save to equal the amount from the dividend increase.

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    Replies
    1. S Cummings,

      Definitely always welcomed. Hope they raise it some more if the Spectra Energy acquisition passes all the hurdles.

      Regardless, the raise is dividend growth investing at work.

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