Investing in Energy: TotalEnergies and Enbridge Insights

Investment Insight: Energy stocks like TotalEnergies and Enbridge present long-term growth potential as they transition to cleaner energy sources while offering attractive dividends.

Date: 14-01-2025

AI Rating: 7

Market Outlook

The report outlines significant ongoing changes in the energy sector, emphasizing long-term investment opportunities within companies like TotalEnergies and Enbridge. Readers are encouraged to consider the evolving landscape and the essential role that these companies play in transitioning towards cleaner energy while maintaining substantial cash flows from traditional energy sources.

TotalEnergies

TotalEnergies is highlighted as a robust choice for investors, offering a dividend yield of 5.8% while pursuing a strategic shift toward cleaner energy. Notably, the integrated power sector contributed approximately 10% of adjusted net operating income in the first nine months of 2024, with a remarkable 20% year-over-year increase in this segment. This suggests a positive outlook for TotalEnergies, especially with its commitment to maintain dividends despite transitioning towards a cleaner profile.

Enbridge

Enbridge is noted for its stability and reliability as a North American midstream giant, showcasing a 6.1% dividend yield. It has recently augmented its position in cleaner energy, increasing exposure to cleaner-burning natural gas from 40% to 47% of EBITDA, while reducing reliance on dirtier oil from 57% to 50%. This strategy to leverage cash flows from traditional sources while incrementally shifting towards cleaner alternatives indicates a solid transition plan.

Stocks: TTE ENB