Then and Now – Enbridge

I’m going to start a new series on my site entitled Then and Now where I revisit some older blogposts and either rip them to shreds (because my thinking has changed since then) or I’ll confirm my position on some personal finance subjects.  I have no idea how often I’ll run these types of posts but I figure it would be something fun to try.  It might be interesting to learn from my past so I can apply those lessons learned for the future.

My interest is in the future because I’m going to spend the rest of my life there.

 – Charles Kettering, American Engineer, Inventor of the electric starter, Former head of research at GM.

Today’s post will look back at my purchase of Enbridge almost 6 years ago.  Enbridge (ENB) was my first blue-chip Canadian dividend paying stock.  I purchased ENB at a time I was starting to unload many of my high-priced mutual funds within my Registered Retirement Savings Plan (RRSP).  These were the days before My Own Advisor was launched and before the Tax Free Savings Account (TFSA) existed.

Then

  • I started buying Enbridge, with a $500 purchase using their Transfer Agent (then CIBC Mellon Trust), in December 2008.
  • I continued buying Enbridge using the Transfer Agent, taking advantage of the full Dividend Reinvestment Plan (DRIP) throughout 2009 and into early 2010.
  • I stopped my full DRIP with the Transfer Agent before the end of 2010.
  • I transferred all Enbridge shares to my discount brokerage.
  • I received a 2-for-1 stock split in May 2011.

Now

  • Enbridge makes up just over 3% of my portfolio.
  • My return on this stock is well over 100%.
  • I have no intention of selling this stock.

Investing is not this easy.  I feel in hindsight my decision to buy (and hold) Enbridge was a bit of a no-brainer but there are no guarantees.   Not every investing decision comes up roses and while Enbridge has been a bright spot in my portfolio to date, the future is always very cloudy.

What do you make of this series?  What to read more “Then and Now” posts in the future?

Mark Seed is the founder, editor and owner of My Own Advisor. As my own DIY financial advisor, I've grown our portfolio to over $600,000 now - but there's more work to do! Our next big goal is to own a $1 million investment portfolio for an early retirement. Subscribe and join the journey!

17 Responses to "Then and Now – Enbridge"

  1. ENB was also one of my first, dividend focused purchases and it certainly has been a winner as you point out. It’s steady performance and dividend growth make it a strong, buy and hold purchase, especially when you got it when we did.

    What would make your series more interesting, would be to take your analysis one step further. You basically gave yourself a ‘thumbs-up’ on the purchase, but what would be interesting would be how you look at it today. Is it worthy of further investments?, do you continue to synthetically DRIP the stock. Off the top of my head, ENB dividend rate was nearly 4% when I first purchased it, today, with capital appreciation it’s less than 3%. What has been the dividend growth rate since purchase? What are prospects looking forward?

    This view would add meat to the ‘Then and Now’ concept.

    Reply
    1. You made some good points gmf.

      I look at ENB as a buy but not really at these prices, although it will likely continue to go up. I’ve recently turned off the DRIP for ENB since the price is high and will take the cash instead. I hope to build up some money for a stock market correction.

      I think ENB remains an excellent buy and hold for my portfolio. The dividend growth rate has been about 13% per year over the past 10 years.

      Reply
  2. I like the new series, MOA. Do you own the ENB shares in a tax-sheltered account? I am DRIPping BNS which I started in the end of 2013. Once I get a good amount of money into it, I am thinking of transferring it to a TFSA account. There is some writeup on dripprimer.ca but would appreciate if you have any more resources and points on the transfer process.

    regards
    R2R

    Reply
  3. Looking forward to the series as well Mark. Hindsight is 20/20, and what’s important is that we learn from our mistakes from the past and not get too overconfident on past success.

    Reply
    1. For sure, re: energy sector has growth in the future. Not a good news story overall for the environment…I don’t see energy demands curbing for a few more generations.

      Reply
  4. In regards to Enbridge, how do you think Enbridge(ENB) and Enbridge Income Fund Holdings (ENF) compare? Both equities have performed well over the past 5 years, and ENF dividend yield is currently 2.2% higher and conveniently pays out monthly.
    Interested on your thoughts on them 🙂

    Reply
    1. I like ENB more largely because the dividend history is more established but ENF seems to be good as well. Hard to argue with the recent dividend history of ENF, it has been rising every year since 2004. I suppose if you are in need of/are looking for dividend income and already have ample diversification, ENF is a good play. I have considered ENF in the past and may consider it again for my wife’s TFSA next year depending upon the price.

      Reply
  5. Reads much like my plans with TD when I bought it at $28 about 10 years ago, don’t plan on selling it although I am 100% DRiP on it as well (inside RRSPs right now). Starting to think about maybe doing this outside of a registered account, but we shall see.

    Reply
  6. ohoh mark. how will the supreme court decision affect enb. i have quite a bit of cash in enf. hopefully they have some cracker jack negotiators!

    Reply

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