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I wonder how TRP will handle this news on Tuesday. I'm curious to see how much of a drop will ensue.
from morningstar jan 6th - a rather optimisitc view
from morningstar jan 6th - a rather optimisitc view
No Keystone XL, No Problem:
TC Energy Looks Undervalued and Offers an Attractive Yield
Analyst Note Joe Gemino, CPA, Senior Equity Analyst, 6 Jan 2021
We are lowering our fair value estimate for narrow-moat TC Energy to $51 (CAD 66) from $52 (CAD 68). With Joe Biden being sworn in as president later this month, we expect him to rescind the Keystone XL’s presidential permit, and it is unlikely that the pipeline will be built. Accordingly, we are removing the project from our forecasts. The modest decrease in our U.S. fair value was a result of a stronger U.S. dollar versus the Canadian dollar. Despite the lower fair value, we still see almost 25% upside in the 4- star stock. In our view, we think that market is overlooking the incremental cash flow from the company’s growth portfolio, even without the Keystone XL. Additionally, the stock is yielding 6.5% with more than enough coverage from its distributable cash flow.