TransCanada increased its dividend by 5% last week increasing the quarterly dividend to $0.46 per share. I recently added TRP to my portfolio in hopes that it will really take off once the Keystone pipeline has the go ahead to expand into the United States. A lot of people are protesting the pipeline but I hope they all walked or rode their bikes to the protests. Since the big oil producers keep all new clean energy sources from the light of day, eventually we are all going to need Alberta’s dirty, dirty oil
Let’s take a look at TRP’s dividend history:
TRP had cut its dividend in 1999 but it was undergoing a transition and has had 13 years of solid dividend growth since then. I think more than ten years was enough to establish a solid dividend growth history to please me as an investor. TransCanada has a current dividend payout ratio of 100% which does somewhat concern me, but I’m willing to risk my capital on the odds that Keystone pipeline will proceed because, well, there is no other option to keep up with today’s energy demands.
The current yield for TRP is 3.9% which is a decent return on an investment. I’m sure the stock price will eventually level out again and continue to rise in the near future. Until then, I’ll keep re-investing my dividends and keep true to my investment strategy.