On track for a stronger 2018

Canadian Market Summary

February 20, 2018

Enbridge’s Q4/17 results were slightly better than expected with free cash flow per share (FCFPS or DCF as the company defines it) of $1.05 ahead of us and consensus at $1.01. On a full year basis Enbridge’s FCFPS of $3.68 met the company’s guidance range of $3.60-3.90. This would be despite a number of headwinds in 2018 including a late Spectra close, warmer than normal weather and upstream production outages. As such, we view Q4 as the only “clean” quarter in 2017 and looking forward we expect strong growth from the company. We believe Enbridge’s shares are set to outperform in 2018 as the regulatory process regarding Line 3 unfolds (Administrative Law Judge recommendation in April, decision in June), the company executes its funding plan including assets sales, and the growth of the business is shown through improved quarterly results.

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