Enbridge (ENB): A High-Yield Dividend Play with Strong Growth Catalysts in 2026

Enbridge Inc. (ENB) has long been a cornerstone of the Canadian energy sector, offering investors a compelling blend of high yield and infrastructure-driven growth. As we approach 2026, the company's 31-year dividend growth streak, robust 5.83% forward yield, and a pipeline of CA$8 billion in growth projects position it as a standout opportunity for income-focused investors seeking long-term stability.

A Legacy of Dividend Growth and Financial Discipline

Enbridge's dividend history is a testament to its operational resilience and commitment to shareholder returns. The company has now extended its dividend growth streak to 31 consecutive years, with a 3% increase announced for 2026, raising the quarterly payout to CA$0.97 per share. This consistency is underpinned by a disciplined payout ratio of 60-70% of distributable cash flow (DCF), ensuring that dividend growth remains sustainable even in volatile markets. Over the past three decades, Enbridge has delivered a compound annual growth rate (CAGR) of 9% in dividends, a track record that underscores its ability to balance reinvestment and shareholder rewards.

The forward yield of 5.83% as of December 2025-calculated using an annualized dividend of CA$3.88 (adjusted from the CA$0.97 quarterly rate) and a stock price of CA$47.75-positions Enbridge as one of the most attractive high-yield plays in the energy sector. This yield is particularly compelling given the company's strong balance sheet and its focus on cash flow generation through its diversified infrastructure assets.

Growth Projects Fuel DCF Expansion

Enbridge's 2026 growth strategy is anchored by CA$8 billion in new projects, including liquids pipelines and gas infrastructure across the U.S. and Canada. These projects are expected to drive DCF growth of 3% in 2026, with projections of 5% expansion thereafter. The capital expenditure aligns with Enbridge's broader vision to leverage its midstream expertise in a transitioning energy landscape, where demand for reliable infrastructure remains robust.

The CA$8 billion investment is not just a short-term play; it reflects a strategic shift toward higher-margin, long-duration assets. For example, the company's U.S. crude oil pipeline network and Canadian gas transmission systems are poised to benefit from ongoing energy demand and regulatory tailwinds. Analysts note that these projects will enhance Enbridge's operational leverage, enabling it to sustain dividend growth while expanding its earnings base.

Analysts Back the Bull Case

The investment community has taken notice of Enbridge's momentum. In Q4 2025, multiple analysts raised their price targets for ENB, reflecting optimism about its growth trajectory. RBC Capital upgraded its target to CA$72 (from CA$67), BMO Capital set a CA$67 target (from CA$66), and National Bank raised its estimate to CA$66 (from CA$65). The consensus price target now stands at CA$69.57, with a high of CA$73 and a low of CA$66. These adjustments highlight a growing conviction that Enbridge's infrastructure-driven model will outperform broader market volatility.

Importantly, the "Moderate Buy" rating from analysts suggests that the stock is undervalued relative to its long-term potential. With a current price of CA$47.75, the projected targets imply upside of 45-55% over the next 12 months-a rare combination of yield and growth in today's market.

Risks and Mitigants

While Enbridge's fundamentals are strong, investors should remain mindful of macroeconomic risks, including interest rate fluctuations and regulatory changes in the energy sector. However, Enbridge's low leverage (net debt/EBITDA of ~3.5x) and long-term contracts provide a buffer against short-term headwinds. Additionally, the company's focus on regulated assets and toll-based revenue models reduces exposure to commodity price swings, further enhancing its resilience.

Conclusion: A Buy for the Long-Term Investor

Enbridge's 31-year dividend growth streak, 5.83% yield, and CA$8 billion in 2026 growth projects make it a rare combination of income and growth in the energy sector. With analyst price targets rising and DCF expansion on track, ENB offers a compelling entry point for investors seeking a high-yield, infrastructure-driven play with durable cash flow. As the energy transition unfolds, Enbridge's strategic investments position it to deliver consistent returns for decades to come.