Enbridge vs TC Energy Which Is a Better Investment?

Enbridge and TC Energy are two of the largest energy infrastructure companies in North America, with operations spanning across pipelines, storage facilities, and power generation. Both companies have a strong track record of delivering steady dividends and consistent growth to their investors. However, they have distinct differences in their business models, risk profiles, and growth prospects. Enbridge is known for its diversified asset base and stable cash flows, while TC Energy has a more focused portfolio with potential for higher growth. Understanding these differences is crucial for investors looking to compare and evaluate the investment opportunities offered by Enbridge and TC Energy stocks.

Enbridge or TC Energy?

When comparing Enbridge and TC Energy, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Enbridge and TC Energy.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Enbridge has a dividend yield of 6.73%, while TC Energy has a dividend yield of 5.85%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Enbridge reports a 5-year dividend growth of 4.74% year and a payout ratio of 122.28%. On the other hand, TC Energy reports a 5-year dividend growth of 0.30% year and a payout ratio of 77.50%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Enbridge P/E ratio at 19.95 and TC Energy's P/E ratio at 14.04. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Enbridge P/B ratio is 2.02 while TC Energy's P/B ratio is 2.39.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Enbridge has seen a 5-year revenue growth of -0.21%, while TC Energy's is -0.01%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Enbridge's ROE at 10.30% and TC Energy's ROE at 17.25%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $43.12 for Enbridge and $48.21 for TC Energy. Over the past year, Enbridge's prices ranged from $32.85 to $44.14, with a yearly change of 34.37%. TC Energy's prices fluctuated between $34.95 and $50.37, with a yearly change of 44.12%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.