Pembina Pipeline's 6.72% Dividend Machine: A Steady Bet in Rocky Markets

The energy sector has never been a place for the faint of heart. But what if there's a way to profit from its volatility without the stomach-churning swings of common stock? Enter Pembina Pipeline Corporation's CUM RED PFD C preferred shares—a dividend-paying powerhouse offering a 6.72% forward yield with a decade-long track record of uninterrupted quarterly payouts. In a year where markets are as shaky as a carnival ride, this security could be the anchor your portfolio needs.

The Dividend Dynamo: 6.72% and Counting

Let's start with the numbers. Pembina's Series C preferred shares are paying out $1.70 annually per share, split into four quarterly installments of roughly $0.43. That's a 6.72% yield based on the current price, a figure that towers over the paltry returns of 10-year Treasuries or money market funds. What's more, the dividend hasn't missed a beat in 10 years, with payments as recent as June 2025. The stability is unmatched—and the company's financial moves in 2025 back it up.

Why Pembina's Dividend Won't Falter

To understand why Pembina can keep this up, look no further than its energy infrastructure empire. Pipelines are the lifeblood of the oil and gas industry, and Pembina's network spans Canada's oil sands to key export hubs. Unlike exploration firms betting on oil prices, infrastructure operators like Pembina earn fees for transporting commodities—revenue that's steady, not speculative.

But what about the recent subordinated note offerings? Far from a red flag, these moves signal financial discipline. By issuing $200 million in new subordinated notes (at a 5.95% rate) to refinance older preferred shares, Pembina is strengthening its balance sheet. The proceeds also fund general corporate needs, giving the company flexibility to keep its dividend commitments even if energy markets sputter.

A Safe Harbor in a Volatile Sea

While the broader market (think the MSCI World Index) has surged, Pembina's preferred shares haven't budged—0% total return over five years, per the data. But here's the rub: this isn't a growth stock. It's an income generator. In 2025, with interest rates high and recession fears looming, capital preservation matters more than capital gains.

Investors chasing yield often flock to junk bonds or tech stocks, but Pembina's preferred shares offer a middle ground. They're senior to common stock in liquidation (though subordinated to the new notes), and their fixed-rate structure shields investors from rising interest rates—a rarity in today's market.

The Cramer Call: Buy for Income, Not Growth

Here's my take: If you're building a defensive portfolio—one focused on surviving, not sprinting—Pembina's preferred shares are a no-brainer. The 6.72% yield is a cash cow, and the energy infrastructure tailwind ensures Pembina can keep paying it. Just remember:

1. Stick to the dividend dates. To snag the next payout (due in September), you must own the shares by the ex-dividend date (likely August 1).
2. Monitor the energy sector's health. A prolonged oil slump could pressure cash flows, but infrastructure fees are recession-resistant.
3. Avoid day-trading. This is a buy-and-hold play. Capital gains won't excite you here, but the dividend checks will.

Final Word

In a world where “yield” is a four-letter word (literally—Y-E-I-L-D), Pembina's preferred shares are a rare gem. They're not flashy, but they're reliable. If you need income now and can tolerate a lack of growth, pull the trigger. This isn't just a dividend—it's a deal.