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Buy 849 Shares of This Super Dividend Stock for $3,100/Year in Passive Income

Solar panels and windmills
Image source: Getty Images

Written by Demetris Afxentiou at The Motley Fool Canada

One of the main goals of every seasoned and new investors alike is to establish a passive income stream. Fortunately, the market gives us plenty of options to help us meet that goal, including one super dividend stock.

That super dividend stock can provide investors with a whopping $3,100 income in the first year alone.

Meet the super dividend stock you need to buy right now

That super dividend stock is none other than Enbridge (TSX:ENB). The energy infrastructure behemoth is the complete package for investors. Enbridge offers crazy growth potential, one of the best dividends on the market, and is wrapped in a defensive shell.

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Oh, and the stock also trades at an 8% discount over the trailing 12-month period, making it a great option right now.

But what makes Enbridge a great super dividend stock? There are three key points for investors to consider that answer that question.

Enbridge is a huge, defensive titan

Enbridge is best known for its massive pipeline network. That pipeline network, which consists of both crude and natural gas elements, is the largest and most complex pipeline network on the planet.

In terms of volume, Enbridge transports massive amounts of crude and natural gas each day, which positions the company as a defensive titan on the market.

Specifically, Enbridge hauls nearly one-third of all the crude produced in North America. Turning to natural gas, Enbridge transports nearly one-fifth of the needs of the U.S. market.

Incredibly, that’s not even the best part of this super dividend stock.

The price that Enbridge charges for the use of its network isn’t based on the volatile price of the commodity hauled. In other words, irrespective of which way oil prices move, Enbridge continues to generate a recurring source of revenue.

Enbridge is diversified and investing in growth

When most investors think of Enbridge, they automatically associate the company with its crude oil and natural gas pipelines. And while those segments are indeed massive, Enbridge does a lot more than pipelines.

Prospective investors should note that Enbridge also operates the largest natural gas utility in North America. The company also boasts a growing renewable energy portfolio.

Enbridge’s newfound standing above other natural gas utilities comes thanks to a trio of acquisitions that were completed last year. As a result, its natural gas utility business boasts nearly 7 million customers in the U.S. and Canada.

Turning to renewables, Enbridge operates a portfolio of over 40 facilities located in North America and Europe. The energy giant has invested over $9 billion over the past two decades into renewables. In doing so, Enbridge has positioned itself as one of the largest renewable energy companies in Canada.

Collectively, the company has a net generating capacity of over 2,300 MW. That capacity is enough to power over 1.1 million homes.

Enbridge the super dividend stock

Perhaps best of all, we have Enbridge’s dividend. Investors who drop $40,000 into Enbridge can expect to generate an income of $3,100 in the first year alone.

Company

Recent Price

Number of Shares

Dividend

Total Payout

Frequency

Enbridge

$47.07

849

$3.66

$3,107.34

Quarterly

The reason that I mention first-year is thanks to another juicy tidbit about Enbridge. Specifically, the company has provided generous annual upticks to that dividend for nearly three decades without fail.

Management also plans to continue that tradition over the next several years. Note that investors who aren’t ready to draw on that income just yet can choose to reinvest those dividends. This will allow any eventual income to grow further.

That fact alone makes this super dividend stock a perfect buy-and-forget candidate for any well-diversified portfolio.

The post Buy 849 Shares of This Super Dividend Stock for $3,100/Year in Passive Income appeared first on The Motley Fool Canada.

Should you invest $1,000 in Enbridge right now?

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Fool contributor Demetris Afxentiou has positions in Enbridge. The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy.

2024