This energy company will report earnings on February 15. Current estimates are for EPS of $1.06 on revenues of 3.59 billion. The shares have a current dividend yield of 5.31%, paid quarterly.
TC Energy Corporation (TRP.TO, TRP)
From The Successful Investor
TC Energy is a buy. The company (Conservative Growth and Income Portfolios, Utilities sector; TSINetwork Rating: Above Average) operates a 93,300-kilometre pipeline network that pumps natural gas from Alberta to eastern Canada and the U.S. Its other operations include 4,900 kilometers of crude oil pipelines and seven power plants.
The company has formally launched a complaint under the U.S.-Mexico-Canada trade agreement over the U.S. government’s cancellation of its proposed Keystone XL pipeline in January 2021. Keystone XL would have pumped crude from Alberta to U.S. Gulf Coast refineries.
TC is seeking $15 billion U.S. in damages. For the suit to succeed, it must prove it was treated unfairly or differently than an American company would have been. Even if the company wins, it will not re-start the project.
Meantime, the company continues to develop $29 billion of new pipelines and other assets. It expects to complete $6.5 billion of those projects in 2022, and the balance by 2026. Most of the company’s new projects are secured by long-term shipping contracts, which cut their risk.
Thanks to the extra cash flow from its new projects, TC plans to raise its annual dividend by 3% to 5% in 2022 and subsequent years. The current annual rate is $3.48 a share. The stock trades at just 14.8 times TC’s projected 2022 earnings of $4.26 a share.
TC Energy is a buy.
Patrick McKeough, The Successful Investor, www.tsinetwork.ca, 888-292-0296, February 2022