ENBRIDGE INC (ENB) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ENB - CA29250N1050 - Common Stock
48.56 USD
+0.54 (+1.12%)
48.58 USD
+0.02 (+0.04%)
We assign a fundamental rating of 4 out of 10 to ENB. ENB was compared to 207 industry peers in the Oil, Gas & Consumable Fuels industry. While ENB is still in line with the averages on profitability rating, there are concerns on its financial health. While showing a medium growth rate, ENB is valued expensive at the moment. ENB also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- ENB had positive earnings in the past year.
- In the past year ENB had a positive cash flow from operations.
- Each year in the past 5 years ENB has been profitable.
- Each year in the past 5 years ENB had a positive operating cash flow.
1.2 Ratios
- ENB has a Return On Assets of 2.59%. This is comparable to the rest of the industry: ENB outperforms 45.89% of its industry peers.
- ENB has a Return On Equity of 8.61%. This is comparable to the rest of the industry: ENB outperforms 57.00% of its industry peers.
- ENB's Return On Invested Capital of 4.12% is on the low side compared to the rest of the industry. ENB is outperformed by 61.84% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for ENB is significantly below the industry average of 21.94%.
- The last Return On Invested Capital (4.12%) for ENB is above the 3 year average (3.99%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.59% | ||
| ROE | 8.61% | ||
| ROIC | 4.12% |
ROA(3y)2.33%
ROA(5y)2.46%
ROE(3y)7.16%
ROE(5y)7.18%
ROIC(3y)3.99%
ROIC(5y)4.01%
1.3 Margins
- The Profit Margin of ENB (8.74%) is comparable to the rest of the industry.
- ENB's Profit Margin has declined in the last couple of years.
- ENB has a Operating Margin (16.91%) which is in line with its industry peers.
- In the last couple of years the Operating Margin of ENB has grown nicely.
- ENB has a Gross Margin (41.11%) which is in line with its industry peers.
- In the last couple of years the Gross Margin of ENB has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.91% | ||
| PM (TTM) | 8.74% | ||
| GM | 41.11% |
OM growth 3Y2.88%
OM growth 5Y2.35%
PM growth 3Y-8.55%
PM growth 5Y-2.33%
GM growth 3Y5.15%
GM growth 5Y4.19%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ENB is destroying value.
- ENB has more shares outstanding than it did 1 year ago.
- ENB has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, ENB has a worse debt to assets ratio.
2.2 Solvency
- Based on the Altman-Z score of 0.89, we must say that ENB is in the distress zone and has some risk of bankruptcy.
- Looking at the Altman-Z score, with a value of 0.89, ENB is in line with its industry, outperforming 42.03% of the companies in the same industry.
- ENB has a debt to FCF ratio of 25.58. This is a negative value and a sign of low solvency as ENB would need 25.58 years to pay back of all of its debts.
- ENB has a Debt to FCF ratio (25.58) which is comparable to the rest of the industry.
- A Debt/Equity ratio of 1.56 is on the high side and indicates that ENB has dependencies on debt financing.
- ENB's Debt to Equity ratio of 1.56 is on the low side compared to the rest of the industry. ENB is outperformed by 74.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.56 | ||
| Debt/FCF | 25.58 | ||
| Altman-Z | 0.89 |
ROIC/WACC0.56
WACC7.29%
2.3 Liquidity
- ENB has a Current Ratio of 0.80. This is a bad value and indicates that ENB is not financially healthy enough and could expect problems in meeting its short term obligations.
- Looking at the Current ratio, with a value of 0.80, ENB is doing worse than 68.60% of the companies in the same industry.
- A Quick Ratio of 0.68 indicates that ENB may have some problems paying its short term obligations.
- The Quick ratio of ENB (0.68) is worse than 67.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.68 |
3. Growth
3.1 Past
- ENB shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.43%.
- ENB shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 1.11% yearly.
- ENB shows a strong growth in Revenue. In the last year, the Revenue has grown by 32.29%.
- ENB shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.32% yearly.
EPS 1Y (TTM)7.43%
EPS 3Y0.6%
EPS 5Y1.11%
EPS Q2Q%-16.36%
Revenue 1Y (TTM)32.29%
Revenue growth 3Y4.34%
Revenue growth 5Y1.32%
Sales Q2Q%-1.63%
3.2 Future
- ENB is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.06% yearly.
- The Revenue is expected to grow by 7.24% on average over the next years.
EPS Next Y4.67%
EPS Next 2Y5.39%
EPS Next 3Y6.44%
EPS Next 5Y7.06%
Revenue Next Year34.15%
Revenue Next 2Y15.77%
Revenue Next 3Y11.41%
Revenue Next 5Y7.24%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 22.80, ENB is valued on the expensive side.
- ENB's Price/Earnings ratio is in line with the industry average.
- ENB's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.60.
- With a Price/Forward Earnings ratio of 21.18, ENB is valued on the expensive side.
- ENB's Price/Forward Earnings ratio is in line with the industry average.
- The average S&P500 Price/Forward Earnings ratio is at 25.83. ENB is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.8 | ||
| Fwd PE | 21.18 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ENB indicates a slightly more expensive valuation: ENB is more expensive than 65.70% of the companies listed in the same industry.
- ENB's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.44 | ||
| EV/EBITDA | 14.88 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)4.88
PEG (5Y)20.59
EPS Next 2Y5.39%
EPS Next 3Y6.44%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 5.93%, ENB is a good candidate for dividend investing.
- ENB's Dividend Yield is a higher than the industry average which is at 3.73.
- ENB's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.93% |
5.2 History
- The dividend of ENB has a limited annual growth rate of 4.10%.
- ENB has been paying a dividend for at least 10 years, so it has a reliable track record.
- ENB has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)4.1%
Div Incr Years24
Div Non Decr Years24
5.3 Sustainability
- 152.61% of the earnings are spent on dividend by ENB. This is not a sustainable payout ratio.
- ENB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP152.61%
EPS Next 2Y5.39%
EPS Next 3Y6.44%
ENBRIDGE INC / ENB FAQ
What is the fundamental rating for ENB stock?
ChartMill assigns a fundamental rating of 4 / 10 to ENB.
What is the valuation status for ENB stock?
ChartMill assigns a valuation rating of 2 / 10 to ENBRIDGE INC (ENB). This can be considered as Overvalued.
What is the profitability of ENB stock?
ENBRIDGE INC (ENB) has a profitability rating of 5 / 10.
What is the expected EPS growth for ENBRIDGE INC (ENB) stock?
The Earnings per Share (EPS) of ENBRIDGE INC (ENB) is expected to grow by 4.67% in the next year.
Is the dividend of ENBRIDGE INC sustainable?
The dividend rating of ENBRIDGE INC (ENB) is 7 / 10 and the dividend payout ratio is 152.61%.