December 10, 2018

TransCanada Corp (TRP)

TransCanada Corp (TRP) is one of the largest and most well-established energy infrastructure companies in the world.  With more than 60 years of experience within the industry, the company boasts operations in natural gas, oil pipelines, power generation, and gasoline storage facilities across Canada and the United Sates.  TransCanada’s network of natural gas pipelines consists of over 57,000 kilometres (35,500 miles) and has a supply point at pretty much every major natural gas source in North America.  The company also owns enough storage capacity to safely house 380 billion cubic feet of natural gas.  Although TransCanada Corp (TRP) is not known for its independent power production, it now has ownership shares in companies that produce almost 11,000 megawatts of power in Canada and the USA.  Their Mainline pipeline is the largest in North America and runs underground across Canada.  For over 50 years TransCanada has been responsible for transporting oil and gas from the energy-rich part of the country, across the prairies, to the more heavily industrialized Eastern coasts.

 

TransCanadaThe newest development for TransCanada Corp (TRP) is the mega-sized project that would see crude oil pumped from Saskatchewan and Alberta down through the USA heartland.  With its oil sand production Canada has emerged as the USA’s biggest supplier of oil by far, and TransCanada is looking to cash in on the nervousness that the US government has about relying on oil from Venezuela and the middle-east.  The massive new pipeline that has been proposed is called the “Keystone XL” line and is purported to be engineered to pump over one million barrels of oil per day.  As oil prices climb in the coming decade this pipeline could be a boon for the Canadian economy and TransCanada Corp (TRP) shareholders, as we well as a necessary expense for the oil-started American economy.  That being said, I would definitely recommend paying attention to recent developments where Keystone XL is concerned as many environmentalist lobby groups in the USA are pulling out all the stops to try and stop this purchase of oil-sand produced “dirty” oil.  They have succeeded to a limited extent in disrupting immediate construction, however my guess would be that the need to diversify away from the geo-political nightmare that is foreign oil will be a stronger argument than the one environmentalists put forward.

 

TransCanada Corp’s (TRP) stock is trading right around $40 a share at the moment.  It has stayed fairly consistent given the market volatility the past few years.  It has a 52-week high of $43.72 and a low of 35.49.  I wouldn’t say this is a “no-brainer” buy, as the company is valued at a sizeable price-to-earnings ratio of about 21, but one could do a lot worse if they are looking for stable dividend payer.  TransCanada has a solid history of upping their dividend, and their current annual dividend at 1.68 has a solid yield of over 4%.

 

TransCanada Corp (TRP) Dividend Stock Graph:

TSE TRP

TransCanada Corp (TRP) Dividend Stock Metrics:

TickerNamePriceDividend YieldPayout RatioDEBT_TO_MKT_CAPDividend Growth 5 yearsDividend Growth 1 years
TRPTransCanada Corp41.244.0790.380.835.585.19

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