Enbridge Stock: Buy Now or Wait for More Downside?

Enbridge (TSX:ENB) recently pulled back after hitting a new all-time high. Investors who missed the rally are wondering if ENB stock is now attractive to buy for a self-directed Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP) focused on dividends and long-term total returns.

Enbridge share price

Enbridge trades near $70 per share at the time of writing. The stock is up nearly 20% in the past year but is now below the $73 it topped last week on the announcement of solid 2025 financial results.

The energy infrastructure and utilities firm reported record results for 2025. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose to $19.95 billion from $18.62 billion in 2024. Adjusted earnings came in at $6.58 billion, up from $6.04 billion. Adjusted earnings per share (EPS) rose from $2.80 in 2024 to $3.02 last year. Distributable cash flow (DCF), which is important for dividend investors, increased to $12.45 billion compared to $11.99 billion in 2024.

Enbridge sanctioned $14 billion in organic growth projects in 2025. The capital backlog is now $39 billion. As the new assets are completed and go into service over the next few years, Enbridge expects adjusted EBITDA, adjusted EPS, and DCF to rise by about 5% annually starting in 2027. Enbridge had delivered on its guidance for 20 consecutive years, so investors should be comfortable with the outlook.

Acquisitions and new development projects could boost the growth guidance.

Rising demand for natural gas bodes well for Enbridge, which has extensive transmission and storage infrastructure and natural gas utilities. Gas-fired power generation facilities are being built to supply electricity to AI data centres.

Enbridge’s renewable energy division is also building new solar and wind projects to provide power specifically for tech companies that are expanding their operations.

Risks

The anticipated increase in oil supply to the United States from Venezuela could displace oil flows from Canada that currently feed U.S. refineries on the American Gulf Coast. Analysts initially speculated that this could eventually reduce volumes along Enbridge’s oil pipeline network.

In the fourth-quarter 2025 earnings report, Enbridge said that it remains committed to moving ahead with a planned expansion of its oil pipeline capacity running to the U.S., citing ongoing support from Canadian oil producers.

It will take years for Venezuela’s production to increase significantly. That being said, investors need to keep it in mind.

Opportunities

In Canada, the government is in discussions with western provinces to potentially build a new oil pipeline to move oil from Alberta to the coast, where it can be shipped to international buyers. This is part of the government’s plan to reduce reliance on energy sales to the United States. Enbridge’s strong position in the oil infrastructure sector would make it a top candidate to participate in a new major pipeline.

Enbridge’s size and balance sheet strength give it the financial clout to make large strategic acquisitions, while still growing the business through organic projects.

Dividends

Enbridge has increased the dividend for 31 consecutive years. Projected DFC growth should support ongoing dividend hikes. Investors who buy ENB stock at the current level can pick up a dividend yield of 5.5%.

Time to buy?

The broader market is due for a correction after the stellar gains chalked up over the past year, so I wouldn’t back up the truck just yet. That being said, dividend investors should be comfortable starting a position in Enbridge at this level. You get paid well to ride out turbulence, and any additional pullbacks would be an opportunity to add to the holdings.

The post Enbridge Stock: Buy Now or Wait for More Downside? appeared first on The Motley Fool Canada.

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More reading

• 3 Canadian Dividend Stocks for Passive Income That Keep Growing
• Should You Buy Enbridge While it’s Below $71?
• Invest $30,000 in 3 Stocks for $1,280 in Passive Income
• Cash-Rich Canadian Companies That Thrive in Economic Downturns
• TFSA Millionaire Goals: Here’s How Much You Should Save Monthly

The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy. Fool contributor Andrew Walker has no position in any stock mentioned.