Suncor Energy Inc. T.SU

ENB continues to diversify why SU hibernates

[Obscure1]

ENB has made another large gas acquistion for $14 billion from Dominion.  

This gas pipeline deal is smaller ($14 billion vs $37 billion) and different from the gas pipeline acquistion from Spectra as ENB financed the equity portion of this deal with a $4 billion bought deal with Canadian underwriters. ENB learned the hard way from the Spectra deal that you don't hand Americans 694 million shares of a Canadian company. 

Since 2017, ENB has made 3 large deals.  The first was buying Spectra, a US based gas pipeline company for $37 billion.  In 2021, ENB bought a port in the Gulf of Mexico to ship LNG for $4 billion cash.  This week, they bought another gas pipeline for $4 million cash plus debt. 

What is missing from all of the deals?

1) oil content
2) Canadian content

Why?  

Are the guys at SU smarter than the guys at ENB?

Are the international companies that have been selling oil patch assets to SU just plain dumb? 

Are all the professionally managed funds that have been exiting SU dumb as well?

The SU share price has been performing well recently.  Is SU smarter than everyone?

[Experienced]

As I mentioned in my post this morning, ENB has bought these assets at around a P/E ratio in the high teens whereas the market valuation of ENB before the deal was 23X.  In this scenario, it makes a lot of sense to finance a big portion of the deal through equity which is what they are doing. I am a fan of natural gas producers even over the medium term as I see the demand rising as people

[matt2018]

If its such a great deal for ENB, then why is the stock at a 52 week low? Take a look at a chart on TC Enenrgy (TRP).  Looks a lot like the ENB chart doesn't it?   TC Energy continues to drop even after this latest spinoff plan/announcement. For starters on this US$14.0B ENB deal, they are taking on exising debt of US$4.6B. To fund the other US$9.6B .....they announced a CDN$4

[meritmat]

I own both.  Thinking of buying more ENB, love the div Cant really compare the two. One is a midstream and the other a true oil company.    

[integrity11]

Meritmat I own both, but ENB only as per 1:50 today. I may regret not waiting for a few more trading days, but the price seemed too good to pass up. The dividend is good until at least the Dec 1 payment and hopefully much longer.  SU now has great support on the SU board by some very knowledgeable oil, ng and pipeline people. It used to have many negative posters, but the vast majority are

[meritmat]

  nice. I only have a little toe in ENB.   I have a bunch of div being dumped in my accounts the middle of the month so I'm going to increase my holdings.  Was going to go more into Captial power but this looks like a bargain 

[mrbb]

My answer is actually some questions back to you Why did ENB tanked on the news of their gas exposure outside of canada? Enbridge dives as $14 billion Dominion deal sparks debt concerns By Reuters (investing.com) While you're at it, go to ALA board and ask why ALA went into a long slump after diversifing and acquired WGL? (WGL holding is a US company that it provides natural gas