Emera's Preferred Shares: A High-Yield, Low-Risk Oasis in the Income Landscape

Investors seeking reliable income in today's volatile markets should look no further than Emera Incorporated's Series F Preferred Shares (EMA.PR.F). With a robust dividend history, stable cash flows from regulated utilities, and tax advantages that enhance returns, these shares offer a compelling mix of safety and yield. Let's dive into why EMA.PR.F deserves a place in every income-focused portfolio.

The Dividend Machine: Stability Built on Regulated Operations
Emera's preferred shares are underpinned by its core regulated utility businesses, which generate predictable cash flows. The company operates in electricity and natural gas distribution across Canada, the U.S., and the Caribbean, with regulated rate structures shielding it from market volatility. This model has allowed Emera to maintain a 100% dividend payout record since at least 2015, even through economic downturns and operational challenges.

The Series F shares currently offer a 4.79% annual yield based on their $23.95 price (as of July 2025), with a quarterly dividend of CAD 0.3593 per share. This dividend is “eligible” under Canadian tax law, meaning income investors can enjoy a lower tax rate compared to non-eligible dividends. For example, a Canadian investor in the top tax bracket would pay roughly 15% on eligible dividends versus nearly 30% on non-eligible ones—a material difference for those prioritizing after-tax returns.

Valuation: A Sweet Spot in a High-Yield Hunt
While some might argue that EMA.PR.F's yield lags behind peers like Via Renewables' VIASP (11.23%), the risk-adjusted value here is undeniable. VIASP's sky-high yield reflects its risk profile: a fixed-to-floating structure tied to LIBOR, plus trading at a discount to its liquidation preference. In contrast, EMA.PR.F benefits from:
- AA- credit rating (one of the highest in the sector), ensuring covenant protections.
- A five-year rate reset (next due in February . 2030), which locks in favorable terms for investors until then.
- A cumulative dividend structure, meaning missed payments must eventually be made—a rare guarantee in preferred shares.

The 4.79% yield also handily beats the 8.60% sector average for utility preferreds, as many peers face regulatory or interest-rate headwinds. For instance, Enbridge's preferred shares (ENB.PR.N) offer a higher 6.7% yield but carry more exposure to commodity price swings. EMA.PR.F's regulated model offers insulation from such risks.

Addressing Cybersecurity Concerns: A Minor Speedbump
Recent cybersecurity incidents in the energy sector have rattled markets, but Emera's dividend capacity remains intact. The company has invested heavily in digital safeguards, and its regulated rate base allows it to recover cybersecurity costs through rate adjustments—a privilege few industries enjoy. While no company is immune to cyber threats, Emera's track record of operational resilience suggests these issues won't dent its ability to pay dividends.

The Bottom Line: Buy EMA.PR.F for Steady Income
Emera's Series F preferred shares are a rare gem in today's yield-starved environment. With a rock-solid dividend history, tax advantages, and a fortress balance sheet, they provide the safety income investors crave. While higher-yielding peers exist, few match EMA.PR.F's combination of regulatory stability, low default risk, and tax efficiency.

For portfolios needing to weather rising rates and market turbulence, EMA.PR.F is a buy at current prices. Holders can rest easy knowing this dividend machine is built to last.

Final Takeaway:
Investors chasing yield without taking on undue risk should add EMA.PR.F to their watchlist. It's a standout pick in a crowded preferred shares market—and one that could deliver steady returns for years to come.