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By David Berman

For a while there in the summer of 2010, it looked as though Enbridge Inc. (ENB) was going to transform itself from one of the country’s dullest stocks to something far more interesting, if in an infamous sort of way.

The leak of an Enbridge oil pipeline in Michigan, which came on the heels of BP PLC’s massive oil spill in the Gulf of Mexico, threatened to tarnish Enbridge’s reputation. And the costs associated with the cleanup looked as though they might ripple through the company’s smooth earnings flow.

Investors who had slumbered through most of the past 50 years were now alerted to the possibility of volatility ahead.

The concerns were short-lived, though. Enbridge stock fell all of 4 per cent during the crisis and had fully recovered by August. Today, the stock is 15 per cent above its pre-crisis level and the dividend has been given a double-digit boost.

As for financial results in the third quarter, when the leak occurred, you wouldn’t know anything had happened: Profit beat analysts’ expectations by 12 per cent and they rose about 26 per cent above the previous year’s third-quarter results.

There is a lesson here: Enbridge is a rock. In 2008, when the S&P/TSX composite index plunged 35 per cent, Enbridge shares fell all of 1.1 per cent. While the benchmark index remains below its record high in 2008, Enbridge shares are up 25 per cent during the same period.

Over the past 10 years, Enbridge shares have turned in annual losses four times (before factoring in dividends) – but never more than 1.8 per cent. Meanwhile, during all six money-making years, investors scored double-digit gains averaging 18 per cent.

If the stock has been a steady performer over the long term, is there any reason to doubt it now? Probably not.

Record highs are rarely a great time to buy stocks, and Enbridge hit a record high earlier this month. However, the stock’s steady upward trajectory means that it rarely strays far from its high point for very long.

Meanwhile, the stock’s current valuation is in line with long-term averages when you look at its trailing price-to-earnings and price-to-book ratios over the past decade, meaning that it is reasonably priced.

And Enbridge’s payout ratio – how much of a company’s profit is being distributed as dividends – sits at a comfortable 50 per cent. That means increases, a predictable event over the past decade, are close to a sure thing.

Disclosure: None

Source: Enbridge: An Investment Where the Profits Keep on Flowing