Enbridge to Benefit From Rising Power Demand & Data Center Growth

Enbridge Inc. ENB is a leading midstream energy company in North America, transporting approximately 20% of the total natural gas consumed in the United States. The midstream player is heavily investing in several natural gas infrastructure projects, including the AGT Enhancement Project and the Eiger Express Pipeline project, which are expected to generate substantial returns in the future.

The demand for natural gas is supported by several factors, including reshoring, LNG development, data centers and the switch from coal to gas for power generation. Data centers utilize sophisticated servers that support high computational workloads for processing data and training models. The data centers require a huge amount of electricity, which is driving rapid growth in gas demand. Further, the shift from coal to gas for power generation is increasing gas demand. Notably, the rise of data centers and higher power demand present an opportunity for ENB to capitalize on. Enbridge is also expected to gain from the expansion of its natural gas storage facilities and growth in its stable, regulated utility business.

ENB continues to generate stable earnings from its utility and storage businesses and remains committed to supporting the development of North America's LNG capacity by investing in natural gas infrastructure projects.

KMI & WMB Have Stable Business Models

Kinder Morgan Inc. KMI is a leading midstream energy company that operates the biggest natural-gas pipeline system in the United States. It has about 58,500 miles of major pipelines, 7,500 miles of gathering lines and over 700 bcf of gas storage. 

The Williams Companies, Inc. WMB is another leading player in the midstream energy sector, which operates a widespread pipeline system of more than 33,000 miles, including the Transco and Northwest Pipeline systems. These pipeline systems are among the largest natural gas transportation networks in the United States and are anticipated to benefit from the rising natural gas demand.

Both companies generate stable fee-based earnings, resulting in stable cash flows.

ENB’s Price Performance, Valuation & Estimates

Shares of ENB have jumped 11.9% over the past year compared with the 8.3% improvement of the composite stocks belonging to the industry.

From a valuation standpoint, ENB trades at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 15.16X. This is above the broader industry average of 13.87X.

The Zacks Consensus Estimate for ENB’s 2025 earnings hasn’t seen any revisions over the past 30 days.

ENB, KMI and WMB currently carry a Zacks Rank #3 (Hold) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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