Analyst Note| Stephen Ellis |
Enbridge’s second-quarter results were good, in our view. Management reiterated its expectations of a midpoint of CAD 15.3 billion in 2022 EBITDA compared with our CAD 15.4 billion forecast. We continue to expect wide oil and gas spreads to convey incremental marketing opportunities across Enbridge’s footprint in the second half of the year, contributing some modest upside. With no material changes to our near-term outlook, our Canadian fair value remains unchanged, while our U.S. fair value declines to $41 per share based on updated exchange rates. Our narrow moat rating is also unchanged. Notably, about 80% of Enbridge’s EBITDA has a level of protection against inflation via fixed revenue escalators or cost of service contracts.