Spectra Energy (SE) — This integrated natural gas holding company is a 2007 spin-off from Duke Energy (DUK) and has been steadily growing sales and assets ever since. Along with its subsidiaries, Spectra currently transports about 12% of all natural gas in the U.S. and holds 7% of the nation’s storage capacity
It has consistently increased its dividend, up 37% in the past five years. It now stands at $1.34 per share for a current yield of 3.4%. S&P expects a further increase to $1.37 in 2014. On Feb. 4, the company reported Q4 earnings of $0.41 per share versus a consensus estimate of $0.38, and revenues beat estimates as well. Consensus earnings estimates for 2014 are $1.52 per share, and analysts expect $1.60 in 2015.
I last covered SE on Feb. 19, near $37, saying, “Just prior to the earnings report, the stock broke from an eight-month consolidation, which followed a breakaway gap in June. Accumulation has been above normal and MACD is in bullish territory. Buy SE for long-term participation in the growing natural gas industry and a trade to the mid-$40s.”
SE is still on my buy list, but since hitting a new high on Monday at $39.59 on below-average volume, it may pull back to its trendline and 50-day moving average at $37.38. Buy SE under $38 with a trading target of $45.