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Enbridge (ENB) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Enbridge (ENB) closed at $41.26 in the latest trading session, marking a +0.32% move from the prior day. This change outpaced the S&P 500's 0.31% gain on the day. At the same time, the Dow added 0.44%, and the tech-heavy Nasdaq gained 0.26%.

Heading into today, shares of the oil and natural gas transportation and power transmission company had gained 3.42% over the past month, outpacing the Oils-Energy sector's loss of 5.93% and the S&P 500's gain of 1.18% in that time.

Investors will be hoping for strength from ENB as it approaches its next earnings release, which is expected to be February 14, 2020. The company is expected to report EPS of $0.50, up 2.04% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $9.53 billion, up 8.9% from the year-ago period.

It is also important to note the recent changes to analyst estimates for ENB. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.43% higher. ENB is currently sporting a Zacks Rank of #2 (Buy).

Looking at its valuation, ENB is holding a Forward P/E ratio of 20.67. This represents a premium compared to its industry's average Forward P/E of 18.8.

It is also worth noting that ENB currently has a PEG ratio of 2.73. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Oil and Gas - Production and Pipelines was holding an average PEG ratio of 4.18 at yesterday's closing price.

The Oil and Gas - Production and Pipelines industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 98, which puts it in the top 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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