Hillcrest Energy Technologies. (CSE: HEAT)
From concept to commercialization, Hillcrest is investing in the development of energy solutions that will power a more sustainable and electrified future.
Certain Toronto Stock Exchange stocks have become more attractive when the stock prices are falling and dividend yields is becoming higher. Take telecoms giant BCE (TSX:BCE), for example, whose current dividend yield has soared to 9% as the share price has plummeted 40% over the past two years.
However, higher dividend yields are certainly not worth buying if they are based on a falling share price.
In contrast, some stocks with solid fundamentals that currently offer generous dividend yields and have the potential for long-term share price gains are excellent investment targets, including Enbridge (TSX:ENB).
This energy stock offers investors a very substantial quarterly dividend, which currently yields a whopping 7.4%, one of the highest dividend yields on the TSX. In fact, the company’s dividend has increased every year for nearly three decades continuously.
Generous dividend yields aside, Enbridge has a diversified business that is responsible for transporting one-third of North America’s crude oil and 24.6 billion cubic feet of natural gas per day, which is about one-fifth of U.S. natural gas demand.
Importantly, over the past two decades, the company has invested more than C$10 billion in renewable energy, including approximately 40 wind, solar and hydroelectric facilities across North America and Europe that generate a reliable, contract-backed revenue stream.
As of 2024, Enbridge’s renewable energy facilities will have enough total generating capacity to power 1.1 million homes. The company also operates a natural gas utility. As a midstream energy company, the company’s inflation-linked contracted asset base provides stability to its financial position.
Meanwhile, Enbridge is continuing to implement its C$25 billion secured capital programme, which is expected to grow at a rate of 3% per annum until 2028. Its asset optimisation and cost-saving initiatives are also delivering 1%-2% CAGR. In addition to organic growth, the midstream energy company is also making strategic acquisitions. It has acquired two US natural gas utility assets from Dominion Energy and is currently working on closing a third deal, with growth prospects looking healthy.
In addition, Enbridge has divested several non-core assets, using the net proceeds to fund acquisitions and reduce debt levels. Given its healthy growth prospects and solid financial position, buying this Canadian energy stock besides its over 7% dividend yield now looks like a smart move.
