If you follow Enbridge Inc (TSE: ENB, NYSE: ENB), you might have noticed the downward reaction in the company's share price when management did not confirm their dividend growth guidance during their Q3 2017 earnings call on November 2nd. Saying that they were in the process of completing their strategic review, management indicated that they would be in a better position to answer during their investor day scheduled for December 12th. As background, Enbridge is one of the rare Canadian companies that provides detailed dividend growth guidance. Until November 30th, their investor relations website indicated that the company expected to grow their dividend by 10-12% from 2018 through 2024.
After the November 2nd earnings call, shares of Enbridge continued to trend downwards losing 7% of their value. Clearly, investors were concerned enough about management not confirming their initial dividend growth projections to punish the share price. On November 30th, two weeks ahead of the company’s December 12th investor day, management said the dividend would increase by 10% next year, and then by the same amount through 2020. The decline in dividend growth (10% vs 10-12%) along with the shorter period (2020 vs 2024) is in response to concerns relating to Enbridge’s ability to fund $22 billion in major growth projects.
While considering Enbridge, I wondered how many Canadian companies provide dividend growth guidance. Since I couldn't find a comprehensive list online for the Canadian companies that provide such guidance, I started with my only portfolio and worked outward adding a couple other companies that I know provide guidance (many of which are on my watch list). Please consider the table below a starting point for further research and let me know of any other Canadian companies that provide dividend growth guidance. I'll gladly update the table with your input.
TransCanada Corp (TRP)
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Dividend growth of 8-10% per year through 2020
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Enbridge Income Fund (ENF)
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Dividend growth of 10% per year through 2020
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Emera Inc (EMA)
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Dividend growth of 8% per year through 2020
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Telus Corp (T)
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Dividend growth of 7-10% per year through 2019
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Capital Power Corp (CPX)
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Dividend growth of 7% per year through 2020
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Fortis Inc (FTS)
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Dividend growth of 6% per year through 2022
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Algonquin Power (AQN)
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Dividend growth of 10% per year through 2021
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Brookfield Infrastructure Partners (BIP.UN)
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Annual distribution increases of 5-9%
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Brookfield Renewable Partners (BEP.UN)
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Annual distribution increases of 5-9%
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Brookfield Property Partners (BPY.UN)
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Annual distribution growth of 5-8%
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Does dividend growth guidance make you any more likely to invest in a dividend growth company?
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ReplyDeleteOwn 5 and always pleased when companies commit to maintaining their dividend increases.
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