Shares of pipeline giant Enbridge (TSX:ENB)(NYSE:ENB) are trading around $70 right now and are down 13% from their recent highs. On a year-to-date basis, it's still up around 7% but with it being down from its highs, that's good news for income investors who want a bit of a higher yield, because as the stock price goes down, that means more dividend income for your investment, which translates into a higher yield.
Due to the drop, the oil and gas stock is now yielding 5.5%, which is lower than what Enbridge has been at in prior years, but it's still a fairly high yield overall. With the markets being hot this year and many stocks around record levels, finding a good yield is not as easy as it has been in the past.
What sweetens the deal for long-term investors is that Enbridge is a dividend growth stock; it has been raising its payout for decades. Its long-term stability and consistent growth enables it to continuously boost its dividend year after year. For investors, that means more dividend income the longer you hang on to the stock.
For Canadian investors, this can be an ideal stock to put within a tax-free savings account (TFSA), where the dividend income and the gains from the stock won't be taxable. It's one of the best dividend stocks to put in a TFSA for that reason, as it can produce some terrific returns for investors in the long run. While Enbridge's stock may not be near its lows, it can still be a great buy right now.
