TC Vitality (TSX:TRP) was one of many winners to come back out of final week’s yo-yoing market. TC inventory rose after robust earnings and has since solely been climbing increased. So, let’s see what’s been driving the inventory just lately and if there’s extra to come back.

Incomes its earnings

Shares of TC inventory rose after the corporate reported robust outcomes for its fourth quarter. The corporate delivered 16% progress in comparable earnings earlier than curiosity, taxes, depreciation, and amortization (EBITDA) at $31 billion. Earnings per share (EPS) additionally got here in at $1.35 for the quarter, up 22% in comparison with 2022 ranges.

As for the total yr of 2023, there was much more nice information. TC inventory noticed 11% progress in EBITDA to $11 billion. Additional, earnings nearly double to $6.1 billion for the yr. EPS elevated 5% to $4.52 for 2023, with internet revenue per share at $2.75. That was far increased than the online revenue per share of $0.64 the yr earlier than.

TC inventory attributed the robust outcomes each within the full quarter and the yr to continued “reliability, availability, and distinctive operational efficiency of our belongings.” This included its pure fuel pipelines enterprise, which continued to see robust utilization.

Extra to come back?

However maybe what buyers are much more focused on is the long run. If TC inventory can do properly with problematic fuel costs (which aren’t associated to pipelines any manner) and better rates of interest, what can it do throughout a optimistic setting?

The corporate is now specializing in long-term progress, which incorporates the completion of its Coastal GasLink pipeline mission. Moreover, it intends to spin off its liquids pipelines enterprise for much more shareholder worth.

Lastly, its asset divestiture program has definitely helped the corporate strengthen its backside line. And that improved monetary place ought to assist as the corporate seems to execute initiatives this yr. This contains round $5.3 billion in 2023 in its finances. These would come with the growth of its NGTL System and Bruce Energy Unit 6 Main Part Alternative.

The most effective half?

But maybe the greatest half for buyers immediately was that TC inventory reported it could be rising its dividend as soon as extra. The corporate introduced a 3.2% dividend improve in its quarterly dividend. This elevated it to $0.96 per share quarterly, or $3.84 per yr. It was additionally the twenty second consecutive yr of dividend progress for the corporate.

That places the corporate at a dividend yield of seven.2% as of writing! That is large for a corporation seeing robust returns, particularly throughout the previous few months. Shares are up about 18% since bottoming out again in October.

General, the corporate believes that the inventory ought to proceed to see its shares develop by 5-7% within the years to come back. It must also have the ability to proceed rising its dividend as properly, particularly with progress readily available. And because the inventory seems for extra alternatives in renewable power, this might solely be the start of this progress inventory’s future trajectory. In the meantime, you possibly can choose it up for a beneficial 19 instances earnings as of writing, with analysts rising worth targets every single day.