Topic: Dividend Stocks

TRANSCANADA CORP. $57.90

TRANSCANADA CORP. $57.90 (Toronto symbol TRP; Shares outstanding: 702.0 million; Market cap: $40.2 billion; TSINetwork Rating: Above Average; Dividend yield: 3.9%; www.transcanada.com) will build a new 800- kilometre natural gas pipeline in Mexico.

The project—called Sur de Texas-Tuxpan- —will cost $2.1 billion U.S. and is part of a new joint venture agreement with Sempra Energy (New York symbol SRE).

TransCanada will contribute $1.3 billion U.S. for 60% of the operation. It will also operate the pipeline when it starts up in late 2018. Sempra will pay $800 million U.S. for the remaining 40%.

The joint-venture partners have a 25-year contract to supply gas for Mexico’s state-owned electrical power company. That cuts the risk for this project. TransCanada is also building two other gas pipelines in the area, so it can lower its costs by sharing workers and equipment.

TransCanada is a buy.

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