The S&P 500's Dividend Yield Is Down to Around 1%. Buy This 5%-Yielding Pipeline Stock to Boost Your Passive Income.

Growth stocks continue leading the market higher. If you're an income investor shopping around for a new dividend-paying company, however, you might be a bit discouraged. That's because the market's relentless bullishness, which has driven the S&P 500 (SNPINDEX: ^GSPC) more than 100% higher since late 2022 (and up 16% just since late March), has also pared the index's dividend yield down to a record low of just over 1%. It suggests there are no great yields to be found anywhere.

Now dig deeper. They're out there, if you're willing to look a bit off the beaten path. A company called Enbridge (NYSE: ENB) fits the bill, with its forward-looking dividend yield of 5.1%.

Enbridge is oil-price-agnostic

It's not a household name. There's a good chance, however, that your household regularly depends on the service it provides.

Enbridge owns over 18,000 miles' worth of natural gas and crude oil pipelines in the United States and Canada, moving 5.8 million barrels of oil and liquids every day. The company handles 30% of the crude drilled in North America, in fact, and 20% of the gas that the United States consumes.

Yes, the energy business that's known for its increasingly volatile prices. Oil prices soared because of the military conflict with Iran, for instance, but are now plummeting on the International Energy Agency's call for a supply glut next year.

Here's the thing: Enbridge's business isn't built around the price of oil. It's essentially a tollbooth, charging other energy companies a fee based on the amount of natural gas and crude oil it's pushing through its pipelines. As long as North America continues consuming both, Enbridge's reliable revenue stream remains intact. This, of course, is ideal for supporting recurring dividend payments.

Image source: Getty Images.

And this demand is holding up. The United States Energy Information Administration reports the nation consumed nearly 2.78 trillion cubic feet of natural gas in March, up 1% year over year. As for crude oil, the EIA says the industry delivered 2% more of it in March of this year than it did in March of last year. This growth trend hasn't changed in the meantime, either, despite higher prices. Indeed, the U.S. Energy Information Administration predicts domestic demand for natural gas will reach record levels this year.

Now all of a sudden Enbridge's 31-year streak of annual dividend increases makes sense.

Perfect for its purpose

Sure, there will come a time when the world weans itself from gas and oil in favor of more environmentally friendly renewables. That time isn't anywhere on the horizon, however. The International Energy Agency now doesn't expect the world to reach "peak oil" -- the point at which demand for crude oil stops growing and begins permanently shrinking -- until 2050, and even then we'll still need plenty of gas and oil past that point. There's good money to be made in the business in the meantime.

Even so, Enbridge is preparing for its inevitable distant future by investing in renewables like wind farms and solar power production facilities. The upside of this strategic shift is that it's got plenty of time to do it right.

The one arguable downside? There's not a lot of capital appreciation to be reaped here. Enbridge is first and foremost an income growth holding, albeit a good one.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Enbridge. The Motley Fool has a disclosure policy.