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ENB

Enbridge Inc – Natural Gas Distribution
Enbridge Inc. is a leading North American energy infrastructure company. Enbridge safely and reliably delivers the energy people need and want to fuel quality of life. Its core businesses includes Liquids Pipelines, which transports approximately 25 percent of the crude oil produced in North America; Gas Transmission and Midstream, which transports approximately 20 percent of the natural gas consumed in the U.S.; Gas Distribution and Storage, which serves approximately 3.8 million retail customers in Ontarioand Quebec; and Renewable Power Generation, which generates approximately 1,750 MW of net renewable power in North Americaand Europe.
Analysis Results
Intrinsic Value $185.69
Latest Price $37.10
Relative Value 80% undervalued
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Cash Flow (Billions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 23.5%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 4.3%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 23.5%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (billion) Present value (billion)
2022 6.16 5.91
2023 7.6 6.99
2024 9.39 8.27
2025 11.6 9.79
2026 14.3 11.6
Terminal Value

Assuming the company was sold after the projection period at an exit multiple of 30, the terminal value of the company would be 429 billion. This corresponds to a present value of 333 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 42.6 billion. Adding in the terminal value gives a total present value of 376 billion.

There are presently 2.02 billion outstanding shares, so the intrinsic value per share is 185.69.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 14,074,185,205
Current Cash 449,293,109
Current Liabilities 28,636,937,393
Current Debt 12,063,362,896
Non-Cash Working Capital (NCWC) -2,948,682,400
Change in NCWC -592,026,043
EBIT 14,949,207,100
Tax Provision 2,222,901,223
Depreciation and Amortization 6,051,318,384
Capital Expenditure -12,713,738,237
Unlevered Free Cash Flow 4,957,909,342
Current Assets 5,768,040,035
Current Cash 354,714,843
Current Liabilities 10,970,262,810
Current Debt 3,200,281,260
Non-Cash Working Capital (NCWC) -2,356,656,357
Change in NCWC -416,772,076
EBIT 7,135,889,529
Tax Provision 607,409,930
Depreciation and Amortization 2,913,056,409
Capital Expenditure -4,410,392,517
Unlevered Free Cash Flow 3,903,600,320
Current Assets 6,763,918,918
Current Cash 496,659,428
Current Liabilities 12,270,860,270
Current Debt 4,063,716,499
Non-Cash Working Capital (NCWC) -1,939,884,281
Change in NCWC -92,658,238
EBIT 7,807,057,008
Tax Provision 1,309,096,148
Depreciation and Amortization 2,599,031,054
Capital Expenditure -4,362,631,896
Unlevered Free Cash Flow 4,181,129,266
Current Assets 6,288,491,517
Current Cash 380,009,170
Current Liabilities 10,897,753,324
Current Debt 3,142,044,933
Non-Cash Working Capital (NCWC) -1,847,226,043
Change in NCWC -594,589,792
EBIT 6,197,524,071
Tax Provision 173,865,199
Depreciation and Amortization 2,381,292,984
Capital Expenditure -5,389,087,574
Unlevered Free Cash Flow 2,183,707,419

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