Motley Fool recommendationI hate to disappoint the children on this board, but I'm going to change the subject.
(from The Motley Fool)
Inter Pipeline (TSX:IPL) operates oil sands pipelines, conventional oil pipelines, natural gas processing facilities, and bulk liquids storage sites.
The stock is down in the past year amid concerns the company might have to take on too much debt to get its $3.8 billion Heartland Petrochemical Complex built.
The development is on track for completion by the end of 2021 and is expected to boost average annual EBITDA by $450-500 million. This should provide support for the existing dividend or even lead to more increases in the payout.
Management is considering a sale of the European bulk liquids business to help fund the capital program. The division generated strong Q3 2019 results, compared to the previous year, so the timing for a sale could be attractive.
Inter Pipeline pays its dividend monthly. The board held the distribution steady in 2019, but raised it in each of the previous ten years. The current distribution should be safe and provides an annualized yield of 7.8%.
The company rejected a takeover offer earlier this year. One media source reported the bid at $30 per share. Inter Pipeline trades at $22 per share right now, so there could be some nice upside on the way.