Enbridge Downgraded to Hold by Jefferies Amid Growth Concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy ENB?
Source: seekingalpha
- Rating Downgrade Impact: Jefferies downgraded Enbridge from Buy to Hold with a C$76 price target, resulting in a 3.3% drop in stock price on Tuesday, reflecting a market reassessment of its growth prospects.
- Historical Price Peak: Although shares reached all-time highs last Friday, driven more by positive commentary on Venezuela than by a strong Q4 earnings report, Jefferies analyst noted that this rally was largely sentiment-driven.
- Long-Term Growth Guidance Maintained: Enbridge has maintained its FY 2026 and long-term growth guidance, expecting to issue final investment decisions for additional gas projects later this year, indicating confidence in future development.
- Valuation Comparison: Enbridge currently trades at 12.8x and 12.2x on 2027 and 2028 EBITDA, respectively, and despite a 12% year-to-date increase, it trades at a ~0.5x discount to TC Energy, reflecting market recognition of the latter's greater growth visibility.
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Analyst Views on ENB
Wall Street analysts forecast ENB stock price to fall
10 Analyst Rating
5 Buy
5 Hold
0 Sell
Moderate Buy
Current: 53.880
Low
45.79
Averages
53.54
High
69.00
Current: 53.880
Low
45.79
Averages
53.54
High
69.00
About ENB
Enbridge Inc. is an energy transportation and distribution company. The Company's segments include Liquids Pipelines, Gas Transmission, Gas Distribution and Storage, and Renewable Power Generation. Liquids Pipelines consists of pipelines and terminals in Canada and United States that transport and export various grades of crude oil and other liquid hydrocarbons, including the Mainline System, Regional Oil Sands System, Gulf Coast and Mid-Continent, and Other. Gas Transmission consists of its investments in natural gas pipelines and gathering and processing facilities in Canada and United States, including United States Gas Transmission, Canadian Gas Transmission, United States Midstream, and Other. Gas Distribution and Storage consists of its rate-regulated natural gas utility operations in Canada and United States. Renewable Power Generation consists primarily of investments in wind and solar assets, as well as equity interests in geothermal power and power transmission assets.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Enbridge Inc. Share Price Soars 7.07% Following Strong Q4 Results
- Earnings Beat: Enbridge Inc. reported an adjusted EPS of $0.65 for Q4 2025, exceeding estimates by $0.08, with quarterly revenue growing over 10% YoY to $12.61 billion, surpassing forecasts by $3.33 billion, indicating robust financial performance.
- Net Profit Surge: The company's net profit for Q4 quadrupled to C$1.95 billion compared to C$493 million in the same quarter last year, reflecting strong profitability in oil and gas transportation and distribution, further solidifying its market position.
- Strong Project Backlog: As of the end of FY 2025, Enbridge had a project backlog worth approximately C$39 billion, with around C$8 billion expected to come online this year, providing substantial support for future revenue growth.
- Consistent Dividend Growth: Enbridge has increased its dividend for 31 consecutive years, highlighting its status as a dividend aristocrat, with the CEO noting that the company exceeded its 2025 guidance for both EBITDA and DCF per share, demonstrating long-term financial stability and investment appeal.
See More
Enbridge Downgraded to Hold by Jefferies Amid Growth Concerns
- Rating Downgrade Impact: Jefferies downgraded Enbridge from Buy to Hold with a C$76 price target, resulting in a 3.3% drop in stock price on Tuesday, reflecting a market reassessment of its growth prospects.
- Historical Price Peak: Although shares reached all-time highs last Friday, driven more by positive commentary on Venezuela than by a strong Q4 earnings report, Jefferies analyst noted that this rally was largely sentiment-driven.
- Long-Term Growth Guidance Maintained: Enbridge has maintained its FY 2026 and long-term growth guidance, expecting to issue final investment decisions for additional gas projects later this year, indicating confidence in future development.
- Valuation Comparison: Enbridge currently trades at 12.8x and 12.2x on 2027 and 2028 EBITDA, respectively, and despite a 12% year-to-date increase, it trades at a ~0.5x discount to TC Energy, reflecting market recognition of the latter's greater growth visibility.
See More
Airbnb and Snowflake Receive Analyst Upgrades
- Airbnb's Project Y Success: Airbnb's Project Y has driven top-line acceleration with a surprising 6% year-over-year increase in Average Daily Rates, alleviating concerns over oversupply, and is expected to significantly improve margins and revenue moving forward.
- Snowflake's Attractive Valuation: Snowflake has been upgraded due to strong momentum in its AI data cloud platform, with backlog growth accelerating to 38%, leading analysts to believe that the current market undervalues the company, making it a good time to buy shares.
- Enbridge's Risk Factors: Despite solid Q4 results, Enbridge faces long-term profitability risks due to a rapidly expanding $39 billion CapEx backlog, leading analysts to conclude that the stock is currently priced to perfection and not a good buy.
- Microsoft's Competitive Pressure: Microsoft has been downgraded to Hold as analysts highlight its lack of a definitive advantage in AI leadership, with Copilot penetration at only 3.3%, despite a 15.9% revenue growth in its Productivity and Business Processes segment.
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Rising Energy Demand Boosts Fossil Fuel Outlook
- Fossil Fuel Demand Surge: Soaring energy demands from data centers and a modernizing global economy are expected to boost fossil fuel demand, with rising natural gas exports anticipated to provide stable revenue streams for energy companies despite renewable energy growth.
- Chevron's Reliable Dividends: Chevron (CVX) has increased its dividend for 37 consecutive years, currently yielding 3.7%, and expects a 10% annual growth in free cash flow over the next five years, bolstered by its $55 billion acquisition of Hess to enhance its resource base in Guyana.
- Enbridge's Steady Performance: Enbridge (ENB) has raised its dividend for 28 years, with a current yield of 5% and a responsible payout ratio of 66%, ensuring stable cash flow from its oil and gas transportation and utility operations across North America.
- ExxonMobil's Growth Potential: ExxonMobil (XOM) has raised its dividend for 42 years, currently yielding 2.8%, and has invested $59.5 billion in acquiring Pioneer Natural Resources, doubling its land assets in the Permian Basin, indicating a strong outlook for future dividend increases.
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Enbridge Reports Record Earnings and Cash Flow for 2025
- Record Financial Performance: Enbridge achieved CA$20 billion ($14.7 billion) in adjusted EBITDA for 2025, reflecting a 7% increase from the previous year, which underscores the company's ability to grow on a stable revenue foundation and enhances investor confidence.
- Sustained Cash Flow Growth: The company generated CA$12.5 billion ($9.2 billion) in distributable cash flow in 2025, a 4% increase from 2024, allowing Enbridge to raise its dividend by 3% for 2026, pushing its yield to 5.2%, further attracting long-term investors.
- Steady Expansion Projects: Enbridge placed CA$5 billion ($3.7 billion) of organic growth capital projects into service last year and secured CA$14 billion ($10.3 billion) in new expansion projects, increasing its backlog to CA$39 billion ($28.6 billion), laying a solid foundation for future growth.
- Stable Dividend Policy: The company has increased its dividend for 31 consecutive years and achieved its financial guidance for 20 straight years, and with a strong financial profile and low-risk business model, Enbridge is expected to continue its stable dividend growth, making it a reliable income source for investors.
See More
Enbridge Reports Record Earnings and Cash Flow for 2025
- Record Financial Performance: Enbridge achieved CA$20 billion ($14.7 billion) in adjusted EBITDA for 2025, marking a 7% increase from the previous year, which underscores the company's consistent growth on a stable revenue foundation, enhancing investor confidence.
- Steady Cash Flow Growth: The company generated CA$12.5 billion ($9.2 billion) in distributable cash flow in 2025, a 4% increase from 2024, enabling Enbridge to raise its dividend by 3% for 2026, pushing its yield to 5.2%, thereby attracting long-term investors.
- Ongoing Expansion Projects: Enbridge deployed CA$5 billion ($3.7 billion) in organic growth capital projects over the past year and secured CA$14 billion ($10.3 billion) in new expansion projects, increasing its backlog to CA$39 billion ($28.6 billion), laying a solid foundation for future growth.
- Stable Dividend Policy: The company has raised its dividend for 31 consecutive years and has met its financial guidance for 20 straight years, demonstrating its low-risk business model and predictable growth potential, making it an attractive option for long-term investors.
See More
Enbridge Inc. Share Price Soars 7.07% Following Strong Q4 Results
- Earnings Beat: Enbridge Inc. reported an adjusted EPS of $0.65 for Q4 2025, exceeding estimates by $0.08, with quarterly revenue growing over 10% YoY to $12.61 billion, surpassing forecasts by $3.33 billion, indicating robust financial performance.
- Net Profit Surge: The company's net profit for Q4 quadrupled to C$1.95 billion compared to C$493 million in the same quarter last year, reflecting strong profitability in oil and gas transportation and distribution, further solidifying its market position.
- Strong Project Backlog: As of the end of FY 2025, Enbridge had a project backlog worth approximately C$39 billion, with around C$8 billion expected to come online this year, providing substantial support for future revenue growth.
- Consistent Dividend Growth: Enbridge has increased its dividend for 31 consecutive years, highlighting its status as a dividend aristocrat, with the CEO noting that the company exceeded its 2025 guidance for both EBITDA and DCF per share, demonstrating long-term financial stability and investment appeal.
See More
Enbridge Downgraded to Hold by Jefferies Amid Growth Concerns
- Rating Downgrade Impact: Jefferies downgraded Enbridge from Buy to Hold with a C$76 price target, resulting in a 3.3% drop in stock price on Tuesday, reflecting a market reassessment of its growth prospects.
- Historical Price Peak: Although shares reached all-time highs last Friday, driven more by positive commentary on Venezuela than by a strong Q4 earnings report, Jefferies analyst noted that this rally was largely sentiment-driven.
- Long-Term Growth Guidance Maintained: Enbridge has maintained its FY 2026 and long-term growth guidance, expecting to issue final investment decisions for additional gas projects later this year, indicating confidence in future development.
- Valuation Comparison: Enbridge currently trades at 12.8x and 12.2x on 2027 and 2028 EBITDA, respectively, and despite a 12% year-to-date increase, it trades at a ~0.5x discount to TC Energy, reflecting market recognition of the latter's greater growth visibility.
See More
Airbnb and Snowflake Receive Analyst Upgrades
- Airbnb's Project Y Success: Airbnb's Project Y has driven top-line acceleration with a surprising 6% year-over-year increase in Average Daily Rates, alleviating concerns over oversupply, and is expected to significantly improve margins and revenue moving forward.
- Snowflake's Attractive Valuation: Snowflake has been upgraded due to strong momentum in its AI data cloud platform, with backlog growth accelerating to 38%, leading analysts to believe that the current market undervalues the company, making it a good time to buy shares.
- Enbridge's Risk Factors: Despite solid Q4 results, Enbridge faces long-term profitability risks due to a rapidly expanding $39 billion CapEx backlog, leading analysts to conclude that the stock is currently priced to perfection and not a good buy.
- Microsoft's Competitive Pressure: Microsoft has been downgraded to Hold as analysts highlight its lack of a definitive advantage in AI leadership, with Copilot penetration at only 3.3%, despite a 15.9% revenue growth in its Productivity and Business Processes segment.
See More
Rising Energy Demand Boosts Fossil Fuel Outlook
- Fossil Fuel Demand Surge: Soaring energy demands from data centers and a modernizing global economy are expected to boost fossil fuel demand, with rising natural gas exports anticipated to provide stable revenue streams for energy companies despite renewable energy growth.
- Chevron's Reliable Dividends: Chevron (CVX) has increased its dividend for 37 consecutive years, currently yielding 3.7%, and expects a 10% annual growth in free cash flow over the next five years, bolstered by its $55 billion acquisition of Hess to enhance its resource base in Guyana.
- Enbridge's Steady Performance: Enbridge (ENB) has raised its dividend for 28 years, with a current yield of 5% and a responsible payout ratio of 66%, ensuring stable cash flow from its oil and gas transportation and utility operations across North America.
- ExxonMobil's Growth Potential: ExxonMobil (XOM) has raised its dividend for 42 years, currently yielding 2.8%, and has invested $59.5 billion in acquiring Pioneer Natural Resources, doubling its land assets in the Permian Basin, indicating a strong outlook for future dividend increases.
See More
Enbridge Reports Record Earnings and Cash Flow for 2025
- Record Financial Performance: Enbridge achieved CA$20 billion ($14.7 billion) in adjusted EBITDA for 2025, reflecting a 7% increase from the previous year, which underscores the company's ability to grow on a stable revenue foundation and enhances investor confidence.
- Sustained Cash Flow Growth: The company generated CA$12.5 billion ($9.2 billion) in distributable cash flow in 2025, a 4% increase from 2024, allowing Enbridge to raise its dividend by 3% for 2026, pushing its yield to 5.2%, further attracting long-term investors.
- Steady Expansion Projects: Enbridge placed CA$5 billion ($3.7 billion) of organic growth capital projects into service last year and secured CA$14 billion ($10.3 billion) in new expansion projects, increasing its backlog to CA$39 billion ($28.6 billion), laying a solid foundation for future growth.
- Stable Dividend Policy: The company has increased its dividend for 31 consecutive years and achieved its financial guidance for 20 straight years, and with a strong financial profile and low-risk business model, Enbridge is expected to continue its stable dividend growth, making it a reliable income source for investors.
See More
Enbridge Reports Record Earnings and Cash Flow for 2025
- Record Financial Performance: Enbridge achieved CA$20 billion ($14.7 billion) in adjusted EBITDA for 2025, marking a 7% increase from the previous year, which underscores the company's consistent growth on a stable revenue foundation, enhancing investor confidence.
- Steady Cash Flow Growth: The company generated CA$12.5 billion ($9.2 billion) in distributable cash flow in 2025, a 4% increase from 2024, enabling Enbridge to raise its dividend by 3% for 2026, pushing its yield to 5.2%, thereby attracting long-term investors.
- Ongoing Expansion Projects: Enbridge deployed CA$5 billion ($3.7 billion) in organic growth capital projects over the past year and secured CA$14 billion ($10.3 billion) in new expansion projects, increasing its backlog to CA$39 billion ($28.6 billion), laying a solid foundation for future growth.
- Stable Dividend Policy: The company has raised its dividend for 31 consecutive years and has met its financial guidance for 20 straight years, demonstrating its low-risk business model and predictable growth potential, making it an attractive option for long-term investors.
See More
