Energy Transfer vs Enbridge Which Is More Promising?

Energy Transfer and Enbridge are two prominent players in the energy sector, both offering opportunities for investors seeking exposure to the industry. Energy Transfer, a leading midstream company, operates a diversified portfolio of energy assets, including pipelines and terminals. On the other hand, Enbridge, also a major pipeline operator, has a strong presence in both the United States and Canada. Both companies have demonstrated resilience in the face of market challenges, making their stocks an attractive investment option for those looking to capitalize on the long-term growth potential of the energy sector.

Energy Transfer or Enbridge?

When comparing Energy Transfer and Enbridge, 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 Energy Transfer and Enbridge.

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. Energy Transfer has a dividend yield of 9.27%, while Enbridge has a dividend yield of 6.77%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Energy Transfer reports a 5-year dividend growth of 0.24% year and a payout ratio of 110.76%. On the other hand, Enbridge reports a 5-year dividend growth of 4.74% year and a payout ratio of 119.35%.

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 Energy Transfer P/E ratio at 11.47 and Enbridge's P/E ratio at 12.45. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Energy Transfer P/B ratio is 1.26 while Enbridge's P/B ratio is 1.39.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Energy Transfer has seen a 5-year revenue growth of -0.35%, while Enbridge's is -0.21%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Energy Transfer's ROE at 12.63% and Enbridge's ROE at 11.35%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $17.13 for Energy Transfer and $42.33 for Enbridge. Over the past year, Energy Transfer's prices ranged from $13.11 to $17.71, with a yearly change of 35.09%. Enbridge's prices fluctuated between $32.76 and $42.89, with a yearly change of 30.92%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.