Power and Pipes for Mid July, 2026

 

The hot muggy afternoons are here in mid July on the Atlantic Coast with ACs running adding to my power bill but one needs comfort.

On the subject of Power ... Emera, EMA.TO has an ex-dividend date of July 31st with an expected Board announcement of a dividend increase for October. Increases have been around the 1% range since they announced their current lower dividend growth policy with more emphasis on earnings per share. 

In Canada, power and energy headlines have been focused in Alberta for this month, mainly for future builds. Stocks I own, Capital Power, CPX.TO and Pembina Pipeline, PPL.TO have come up several times in the news articles. 

Meta (thinking Facebook) is building a 13 billion dollar data centre in Alberta and Canadian provinces are looking for data centre builders arranging their power and cooling sources in advance. Pembina Pipeline and Stanley Morgan are building a power plant adjacent to Meta's planned build site. Capital Power is also involved in supplying power from their grid in 2028 with a long term contract.

Pembina Pipeline is involved with a 10% stake in an Alberta/Federal Government plan to run a pipeline from Alberta to the BC using a southern route with a future option to buy more of a percentage of that project.

Interesting is Enbridge being a popular stock among individual investors and a huge pipeline owner, recently added that Canada needs to concentrate more on additional oil production to meet future export demand. I'll be focusing on ENB.TO and Fortis, FTS.TO in August.

Personally, I like to see companies I have stock in mentioned in the future energy and economic plans announced by PM Carney and the Federal Government. Pembina Pipeline have a smart management in building up the company to this point. Hopefully, they won't take on too much debt, in turn rethinking their dividend policy but I have faith.

Overall, the stock market is in a Bull run with Canada outperforming the US for now, raising concerns about an eventual dip which will hopefully be short term again but many watch the moves of President Trump, buying the lower price dips with his political and policy moves while looking for gains. That will no doubt continue while he is in power. Just my opinions with this post as always, not investment advise.

Meanwhile, I'm sizing up my bank related ETFs while they are also getting more expensive although I'm not complaining about the gains with ZWB.TO and RCDC.TO, having additional dividend paying companies in the holdings. I've held and further bought RCDC since it launched, mentioned several times in my blog.

On this date, the US and Iran are back into conflict seeking another resolution while the US is looking to control shipping traffic and tolls in the Strait of Hormuz. Many predicted the thinly threaded ceasefire and peace talks wouldn't hold. The price of oil has come up in turn with countries looking to restock their oil reserves which brings Canada's energy resources back into focus.

Quality Dividend Index in June, 2026

 

The off and on opening of the Strait of Hormuz with the current, hopefully resolved Iran-US conflict shows that oil still rules in the world although the electric/battery powered sector continues to slowly grow ... more in some counties than others.

Meanwhile that sparked a want for alternate routes for oil and natural gas from producers and customers around the world to avoid similar future strait blockages trapping shipping and that favours the producers in Canada. Although the price of oil has come down for now, inflation has gone up due to higher transportation costs for goods, passed on to the consumer. That always gets me muttering with political agendas where it hits me in the wallet more in groceries and gas as if they weren't high enough already. Along with that ugly word ... tarrifs.

I read over the "Before the Bell" market news with quick snapshots of what's going on currently although I'm a long term investor. Tech stocks are volatile at times but they rule the S&P 500 for now and that usually turns into collateral damage for other markets at times like the TSX 

When some of my stocks go down due to short term moves, I look at it as a further buying opportunity. Today's headlines ...

Equities     Global markets fell as expectations for imminent interest rate hikes by the U.S. Federal Reserve and debt-backed corporate spending on AI weighed on investor sentiment.     Wall Street futures were in the red after the Nasdaq closed sharply lower yesterday, dragged down by declines in the Megacap technology stocks including SpaceX and Alphabet.     TSX futures followed sentiment lower.

“These are far from dull markets,” said Chris Weston, head of research at Pepperstone Group in Melbourne. “The former generals of the market appear to have lost momentum, and investors are rotating into other areas of the market that are more defensive, less AI-focused and offer more predictable cash flows.”

With "defensive" I'm thinking utilities like Capital Power, CPX.TO. with an ex-dividend date of June 30th, 2026. CPX has been increasing their dividends by about 6% before it's ex-dividend dates in November looking at past years but no guarantee that will occur again this year. Besides data centre builds, the Feds are also talking about nuclear power plants so companies like Capital Power could benefit but that's the government plans for the future. 

CPX has increased in price by about 28% year-to-date and over-valued looking at the Graham Number but I figure investors are factoring in current and future power grid expansions to meet demand.

With pipelines and energy producers, I have South Bow, SOBO.TO and Gibson Energy, GEI.TO on my radar for the last days of June being the 30th and 29th with ex-dividend dates, respectively.  

South Bow is mulling over running a new pipeline into the US given permits for the Keystone project which was halted before when it was part of TC Energy, TRP.TO. losing a substantial investment cost at that time. Now SOBO wants additional assurances from the US before deciding to go ahead sometime in 2027. You burned me once, not twice sort of thing with a wise management.

That gives me confidence they are not rushing into projects although they are green lighted.

Gibson Energy, GEI.TO I've had on my Watchlist for a long time with an attractive yield but with a lengthy research of the company, it has a long history and it's a multi asset business with refinery, railroad, terminals and storage of oil an natural gas along with by products. 

GEI's distributal cashflow currently is running around 90%, where ideal is around 50 to 70% but with expansion and growth comes more debt at times until more revenue kicks in to bring the DCF down.  It's got me interested so I'll probably get involved with a buy.

Earlier this year I was looking for an equity focused growth ETF with decent monthly distribution. I decided on Blackrock's iShares Core MSCI Quality Dividend Index ETF with a Year-to-Date gain of 21%. Impressive after I bought in April. 

I own all the stocks in the current top ten list individually except QSR, Restaurant Brands. Meanwhile XDIV provides additional monthly distributions.

Gordon Pape wrote an article on the Globe and Mail recenty recommending XDIV as a buy on his site.

More information below on XDIV after reading a Morningstar article today among 7 ETFs they ranked by performance.

iShares Core MSCI Canadian Quality Dividend Index ETF

• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★★

This C$5.5 billion fund has climbed 42.53% over the past 12 months, outperforming the average fund in its category, which rose 29.40%. The BlackRock fund, launched in June 2017, has climbed 26.01% over the past three years and 18.59% over the past five.

Reading about investors and ETFs, it's a personal choice of home country, international, sector based along with income related distributions or growth and adding to that ETF market these days are single stock specific ETFs with enhanced income strategies. Overall, there's a variety of ETFs out there and more being launched while others which are not performing as expected are merged or dropped by providers.

In my portfolio, the end of June into July is mainly Canadian Banks ex-dividend month and I'll be looking at adding to those ETFs which hold the big banks and more. The bank sector is strong and like in a continuous growth bull cycle for now while the stocks are getting expensive although there are partial share options out there now.