Topic: How To Invest

The Successful Investor Hotline – Friday, September 10, 2021

Article Excerpt

ENBRIDGE INC., $50.47, Toronto symbol ENB, is a buy. The stock gives you exposure to pipelines pumping oil and natural gas from Western Canada to eastern Canada and the U.S. It also distributes gas to 3.8 million consumers in Ontario and Quebec. Enbridge is now buying Moda Midstream Operating, LLC, which owns North America’s largest crude oil export terminal near Corpus Christi, Texas. That terminal can handle 1.6 million barrels a day, which is equal to 25% of all U.S. crude exports. As well, it can store 15.3 million barrels. The purchase also includes related pipelines that pump oil to this facility. The company will pay $3.0 billion U.S. in cash for these assets when it completes the purchase in the fourth quarter of 2021. That cost is equal to 4% of Enbridge’s market cap of $102.2 billion (Canadian). About 90% of this facility’s revenue comes from long-term “take-or-pay” contracts, which cuts the risk of the purchase. Enbridge expects the new operations will immediately increase…