South Bow raises 2026 normalized EBITDA guidance to $1.04 bln, range +2%/-1%
Company lifts 2026 distributable cash flow guidance to $665 mln, range +/-2%
South Bow expects Q3 2026 normalized EBITDA about 10% lower than Q2's $280 mln
Overview
Canada pipeline operator reported Q2 revenue rose yr/yr to $546 mln
Normalized EBITDA for Q2 grew 9% from Q1 to $280 mln
Company raised 2026 normalized EBITDA and cash flow guidance after strong first-half results
Analyst coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 4 "strong buy" or "buy", 10 "hold" and 4 "sell" or "strong sell"
The average consensus recommendation for the oil & gas transportation services peer group is "buy"
Wall Street's median 12-month price target for South Bow Corporation is C$48.00, about 5.8% below its August 4 closing price of C$50.94
The stock recently traded at 19 times the next 12-month earnings vs. a P/E of 18 three months ago
Result Drivers and Key Details
Gulf Coast demand - Co said disruptions to global crude oil trade flows drove strong demand for capacity on the U.S. Gulf Coast segment of the Keystone Pipeline System
Pipeline throughput - Q2 average throughput was approximately 596,000 bbl/d on Keystone Pipeline and 800,000 bbl/d on the U.S. Gulf Coast segment
Long-term contracts - Co secured 20-year binding commitments from nine customers totaling 465,000 bbl/d of firm transportation service
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