Q: What is your opinion of ENS.to( E Split Corp) for income. Is the dividend sustainable?. Tank you. Cheers
5i Research Answer:
ENS is a split share company that invests (leveraged) entirely into ENB common shares. Its five year annualized return is 14.7% and we would consider it one of the better split share companies. That being said, the leverage adds risks, and if net asset value is not maintained at $15 the dividend stops completely. But it has never missed a dividend (raised in 2019) and ENB itself just raised its own dividend. Split shares have high fees, and the leverage works both ways. Market cap is only $40M here so trading liquidity is weak. Investors need to fully understand what they are buying here, but today we would have little concern on the dividend sustainability of ENS. NAV is nicely above the $15 threshhold right now (above $20).