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BMO Capital upgraded Keyera Corp . (TSX:KEY) (OTC:KEYUF) from Market Perform to Outperform on Wednesday, raising its price target to C$54.00 from C$45.50.
The upgrade follows Keyera’s year-to-date underperformance, with the stock lagging behind industry peers by approximately 540 basis points, making it the worst performer in its group according to BMO Capital.
BMO Capital cited the company’s recently announced C$5.15 billion acquisition of NGL Plains as a "scale-changing" factor in its decision to upgrade the stock rating.
The research firm highlighted Keyera’s attractive pro forma valuation of approximately 9.5 times 2026 estimated EV/EBITDA, compared to the peer average of about 11 times, noting that while Keyera is not as defensive as peers due to its higher proportion of non-fee based assets, it owns strategic infrastructure.
BMO Capital also pointed to Keyera’s anticipated growth rate of more than 10 percent and its lower leverage compared to peers, suggesting a potential total return exceeding 30 percent to the new price target.
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