TC Energy (TRP.TO)

Penalty box. Share price around 5-year low. Plans for spinoff and sale of a trophy asset. Balance sheet doesn't support its capital program. Very attractive 10x earnings, a durable business, a ton of value. He owns and still prefers ENB and PPL.

Huge portfolio of pipelines, a tremendous barrier to entry. Impossible to replicate its assets. Selling Colombian asset to reduce debt, and market recoiled from this shift from growth to debt reduction. Splitting off liquids group. 10x earnings multiple. Yield is 7.89%.

He's about to sell it at a loss. Support has broken down.

It is down nearly 32% in the past year. He recently bought it. Some assets are being sold resulting in a better balance sheet. The pipelines on the west coast are good for oil prices in Canada. Carbon based energy will still be in demand.    Buy 9  Hold 10  Sell 3

The company states that the 'combined dividends of the two companies sustains long-term dividend growth outlook'. So we don't think it puts the dividend 'at risk', but the spin off will likely change where/who the dividend 'comes from'. Also, the company states that 'the initial combined dividends of the two companies will be equivalent to TC Energy's annual dividend immediately prior to the completion of the transaction and that over time the combined value of the two companies' dividends is expectd to remain consistent'. 

TC Energy is expected to grow EBITDA at 7% annually and grow the dividend by 3% to 5% annually. The liquids business is expected to grow at 2% to 3% anually and have a similar dividend growth rate. 
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Shareholders are frustrated. Yesterday, they sold $5 billion in a Louisiana pipeline, and markets were disappointed they didn't fetch more. Rising rates are pressuring long-duration assets like TRP's. Wait for earnings before doing anything, like he is.

The premier natural gas infrastructure company in North America. It pays over a 7% dividend. The Coastal Gaslink overhand is behind us. It's fine that they sell some assets to fund growth. Exporting nat gas beyond North America will double in volume in the coming decade and TRP is incredibly set up to facilitate this. Even at a modest 2% dividend growth rate and share growth, that's still 9-10% compounded annual returns.

Likes pipelines for income, though they've pulled back with the pullback in commodities. Lagged the group. When Coastal GasLink cost overruns are behind them, stock will lift. She owns ENB and PPL instead. All have safe, attractive yields.

He owned it for 20 years and then sold six months ago. It has gone nowhere and has had too many problems. An unrewarding stock even with a 7% yield.

Likes the pipelines, but he prefers ENB. Cost overruns on Coastal GasLink. Keystone is a big question mark, not sure if it's going through next year or not. Trading around 16x. Yield is 6.7%. 

Dividend is safe and will increase YOY, though perhaps not as aggressively as in the past. Not all high-yielding stocks are in trouble. Enormous cost overruns. Tremendous amount of free cashflow, but also huge capital projects which will bring in cash when they come online. A good buy.

It's been held back by overruns in their Coastal Gaslink project and balance sheet issues. Their asset sale is uncertain and and their southeast gateway pipeline has problems. But Q1 was a solid beat and the Gaslink is on track. Gaslink is on schedule and they reiterated 2023. Growth is flat but the dividend is attractive.

It has a 6.7% yield and is guiding to dividend growth over the next few years. It has dropped from $74 to $53 in one year so there is potential for good gains. There has been significant insider buying.    Buy 12   Hold 8   Sell 3

Owns this and Enbridge in energy. Crude oil prices will be challenging in the next few months, but TCE offers some insulation from that. Strong dividend in both companies. A hold and isn't adding to it.

Their struggles trace back to the cancellation of the Keystone. Capital has become more expensive, too.  But they trade at 8x operating cash flow, 12x earnings and pays a decent dividend. There isn't much growth, though. It's fine with this. Offers good downside protection. They can meet natural gas demand with their pipeline. Good valuation. He added to it in the low-$50's. But there will be cost overruns on the Coastal Gaslink project.