Enbridge (ENB) Q3 2026 earnings review
Enbridge gas profit rises, but its oil pipeline earnings fall
Enbridge's natural gas pipelines and utilities are lifting profit while its oil pipelines slip. The North American pipeline and utility operator grew EBITDA, excluding one-offs, by 4% from a year ago, and profit per share rose 7%. Outgoing chief executive Greg Ebel kept the full-year outlook unchanged, which by our math leaves fourth-quarter EBITDA growth stepping up to 5%.
| Adjusted EBITDA | C$4.43B +3.9% from a year ago |
|---|---|
| Profit per share, excluding one-offs | C$0.49 +6.5% from a year ago |
| Secured project backlog | C$38B down from C$41B last quarter |
| Full-year 2026 outlook | Unchanged middle of the range: 2.7% EBITDA growth |
⚖️ Verdict: ⚪ Neutral
The story is unchanged because acquisitions and cost cuts filled the gap left by slower internal project approvals and weak oil pipeline volumes. Enbridge signed US$3.65 billion of oil and gas acquisitions and sold $3 billion of new shares alongside a $2.7 billion partner deal with KKR and Apollo to help pay for them. One caution: the construction backlog fell by $3 billion as completed gas pipelines outnumbered new approvals, and the debt ratio stayed above target.
The question now is whether newly opened projects and acquisitions can lift per-share growth to the 5% target despite more shares and higher interest bills. Supporters point to $3 billion of gas pipes just placed into service and rising utility rates, while skeptics point to shrinking oil pipeline earnings and a 2% jump in share count. The 2027 financial outlook in December will settle it.
🐂 Bull Case
Gas Pipes and Utilities Carry the Quarter
Enbridge runs four main businesses, and its natural gas pipelines and local gas utilities are doing the heavy lifting. Higher regulated rates and new projects in those two divisions more than made up for a slump in oil pipelines, lifting total earnings before interest, taxes, depreciation and amortization (EBITDA), excluding one-offs, by 3.9% from a year ago to $4.43 billion.
- Gas Transmission EBITDA, excluding one-offs: $1.43 billion, up 13.1% from a year ago
- Gas Distribution and Storage EBITDA, excluding one-offs: $665 million, up 18.8%
- Renewable Power Generation EBITDA, excluding one-offs: $127 million, up 27.0% after the first phase of the Sequoia Solar project opened
- New gas pipelines opened this quarter: over $3 billion, including the Aspen Point and Tennessee Ridgeline expansions
Rate increases approved by regulators in Utah, North Carolina, Ontario, and on the Texas Eastern and East Tennessee pipelines drove the gain. Progress also continued in Ohio, where the utility filed a settlement with state parties for a US$145 million yearly revenue increase, easing a concern over rate-freeze politics.
What to watch: the Public Utilities Commission of Ohio decision, expected in or before the first quarter of 2027. Approval would put the new Ohio rates into effect on March 1, 2027 and lock in another step up in utility profit.
Partner Cash and Share Sale Fund Deals
Chief executive Greg Ebel announced "three accretive tuck-in acquisitions in our Liquids Pipelines and Gas Distribution businesses" worth about US$3.65 billion in total. The pipeline group agreed to buy Tallgrass Energy's crude oil pipelines from Wyoming to Oklahoma for US$2.55 billion, bought Salt Creek Midstream's Permian oil gathering pipes for US$0.6 billion, and agreed to buy Laramie Energy's gas supply assets for Utah customers for about US$0.5 billion.
Because the company's debt ratio is already above its target band, Enbridge did not fund these purchases with debt alone. It raised $3.0 billion by selling 44.7 million new common shares and brought in investment firms KKR and Apollo to pay $2.7 billion for a stake of up to 29% in its Westcoast gas pipeline system in British Columbia.
What to watch: the closing of the Tallgrass acquisition after regulatory approvals. Once closed, it adds a contracted 460,000-barrel-per-day oil corridor and the US$0.3 billion Pony Express 2 expansion, due in late 2027.
🐻 Bear Case
Backlog Shrinks as New Project Additions Slow
"Our secured growth backlog stands at $38 billion, even as we placed $3 billion of completed projects into service this quarter," chief executive Greg Ebel said. That secured backlog is the total cost of approved construction projects that Enbridge relies on to deliver its 5% yearly growth target, and supporters view its expansion from $26 billion in late 2024 as the main reason to own the company.
The figure fell from $41 billion last quarter because the company finished $3 billion of gas pipelines while adding only $1 billion of new projects. Moreover, most of that $1 billion came from the US$0.3 billion Pony Express 2 project bought with Tallgrass, alongside a $0.2 billion Long Lake oil sands expansion. New internal project approvals have slowed for two straight quarters after averaging $3 billion to $4 billion a quarter in 2025.
What to watch: new project approvals in the fourth quarter against management's $10 billion to $20 billion target for 2026 and 2027. Another quarter of small additions would mean the construction pipeline is draining faster than Enbridge can refill it.
New Shares and Interest Costs Curb Growth
Enbridge is spending heavily to build and buy pipelines, and the financing bill is holding back what reaches each share. Over the first nine months of 2026, EBITDA excluding one-offs rose 1.9%, but profit per share excluding one-offs fell 1.9% to $2.10 because depreciation rose $159 million and interest costs rose $105 million.
Third-quarter profit per share excluding one-offs rose 6.5% to $0.49, and distributable cash flow rose 4.8% only because the company cut maintenance capital spending by 23.8%, or $72 million, "related to enterprise-wide saving initiatives". Meanwhile, the September sale of 44.7 million shares — "in part to de-risk the funding plan" for the oil deals — increases the share count by 2.0% by our math, while debt still sits at 5.1 times EBITDA, above the 4.5 to 5.0 target.
What to watch: fourth-quarter distributable cash flow per share once all 44.7 million new shares count for a full period. By our math, the full-year outlook midpoint requires fourth-quarter cash flow per share to rise 6.1% from a year ago despite the extra shares.
Oil Pipeline Earnings Fall on Gulf Coast Weakness
Liquids Pipelines is Enbridge's largest division, bringing in half of company EBITDA, and its profit is still shrinking. Segment EBITDA excluding one-offs fell 4.4% from a year ago to $2.21 billion, and is down 5.7% over the first nine months of the year.
Enbridge blamed lower volumes on its Mainline system, lower tolls on Line 9 deliveries, and "lower contributions from Market Access due to underutilized contracts to the U.S. Gulf Coast". Rather than waiting for existing Gulf Coast routes to recover, management spent US$3.15 billion on the Tallgrass and Salt Creek acquisitions to buy contracted volume in the Rockies and Permian basins.
What to watch: Market Access and Gulf Coast results in the fourth quarter, which marks one full year since the Gulf Coast slump began. Continued declines would show that organic oil pipeline earnings are still eroding before the Tallgrass deal closes.
Risks this quarter didn't answer
Four standing operational and financial questions received no update in the third-quarter news release.
- Line 5 Bad River litigation: no update in the release on court remedies after the July appeals court ruling; the quarterly filing legal note will carry any change.
- Mainline Optimization Phase 2: no update on customer commitments or capital costs for the resequenced oil expansion; the conference call is the next readout.
- 2023–2026 profit per share growth target of 4% to 6%: unmentioned again with nine-month profit per share down 1.9%; full-year results will test it.
- Woodfibre LNG and Project Beacon: no cost or permitting update in the release; year-end updates will cover both.
👓 Other Themes
Chief Executive Greg Ebel Retires in January
Chief executive Greg Ebel announced that he will retire in January 2027 after four years leading the Canadian pipeline and utility group. Michele Harradence, an internal executive who has run the gas businesses, will succeed him as chief executive. The company kept its full-year 2026 financial plan and its 5% medium-term annual growth target unchanged alongside the leadership transition.
Weaker Canadian Dollar Lifts Earnings and Debt
A weaker Canadian dollar helped Enbridge's US earnings when translated back into home currency, as the average exchange rate moved to C$1.40 per US dollar from C$1.38 a year ago. However, it also hurt the balance sheet ratio: Debt-to-EBITDA stayed at 5.1x "due to the period end debt balance translating at a 1.42 CAD/USD foreign exchange rate compared to EBITDA translating at an average trailing 12-month rate of 1.39".
💲 Other KPIs
Distributable cash flow — the cash left after maintenance spending and preferred dividends to pay common shareholders — rose 4.8% from a year ago, up from 1.6% growth in the second quarter. A 23.8% drop in maintenance capital spending to $231 million provided more than half of the $123 million gain.
Cash generated from operations fell 5.8% from a year ago, reversing a 27.0% jump in the second quarter. The drop came from a $276 million working-capital outflow in operating assets and liabilities, compared with a $102 million inflow in the prior-year period.
The average share count rose 0.5% from a year ago and 8 million shares from the second quarter. Because the 44.7 million share offering closed on September 14, only two weeks of those new shares sat in the third-quarter average; the full dilution arrives in the fourth quarter.
🔮 Guidance
Unchanged. The plan calls for full-year EBITDA, excluding one-offs, to grow 2.7% at the middle of the range. By our math, after 1.9% growth over the first nine months, hitting the middle of the range requires 5.1% growth in the fourth quarter, helped by new gas pipelines and solar capacity.
Unchanged. The middle of the range points to $5.90 per share, up 3.3% from $5.71 in 2025. By our math, after generating $4.34 per share in the first nine months, the pipeline group needs $1.56 in the fourth quarter, a 6.1% increase from a year ago despite a higher share count.
Unchanged. Enbridge still targets 5% yearly compounding across all three measures after 2026. The company dropped any mention of its earlier 2023–2026 growth bands, where profit per share is currently lagging the 4% to 6% target.
❓ Key Questions
What is the organic project addition rate excluding acquisitions?
Enbridge added $1 billion to its backlog this quarter, including the US$0.3 billion Pony Express 2 project acquired with Tallgrass and $0.2 billion for Long Lake. How much of the $10 billion to $20 billion two-year target will come from organic approvals versus acquisitions?
How much do the new oil deals and shares change 2027 per-share cash flow?
The company issued 44.7 million shares in September to help pay for Tallgrass and Salt Creek, but Tallgrass has not closed yet. What is the timing mismatch on per-share profit in the fourth quarter, and how much per-share accretion arrives in 2027?
Why is the 2023–2026 profit per share target no longer mentioned?
Until late 2025, Enbridge targeted 4% to 6% annual growth in profit per share excluding one-offs from 2023 to 2026. With nine-month profit per share down 1.9% from a year ago, does management still expect to reach that band this year?
When will underutilized Gulf Coast oil pipeline contracts recover?
Liquids Pipelines EBITDA fell 4.4% this quarter partly because customers left contracts to the US Gulf Coast underused, a problem management first called temporary a year ago. Are those contracts expiring at lower rates, or will volumes return?