Citi raises Pembina stock rating, sets C$63 target

Further positive developments expected in 2025 include the resolution of the Alliance pipeline toll review, which is anticipated to have a minimal impact on Pembina’s EBITDA. Additionally, by mid-year, Pembina is projected to announce its ethane supply plan for the Dow ethane cracker. The assignment of Cedar LNG volumes and an upgrade in project EBITDA are also on the horizon, alongside potential upgrades to marketing and fee-based EBITDA guidance.The series of strategic moves and project developments outlined by Citi suggest a robust growth trajectory for Pembina. Trading at a P/E ratio of 18.15 and maintaining a strong dividend yield of 5.07%, the company has demonstrated consistent financial performance. With these factors in mind, the upgrade to a Buy rating reflects a positive outlook for the pipeline company’s financial performance in the near future.

Further positive developments expected in 2025 include the resolution of the Alliance pipeline toll review, which is anticipated to have a minimal impact on Pembina’s EBITDA. Additionally, by mid-year, Pembina is projected to announce its ethane supply plan for the Dow ethane cracker. The assignment of Cedar LNG volumes and an upgrade in project EBITDA are also on the horizon, alongside potential upgrades to marketing and fee-based EBITDA guidance.The series of strategic moves and project developments outlined by Citi suggest a robust growth trajectory for Pembina. Trading at a P/E ratio of 18.15 and maintaining a strong dividend yield of 5.07%, the company has demonstrated consistent financial performance. With these factors in mind, the upgrade to a Buy rating reflects a positive outlook for the pipeline company’s financial performance in the near future.

Further positive developments expected in 2025 include the resolution of the Alliance pipeline toll review, which is anticipated to have a minimal impact on Pembina’s EBITDA. Additionally, by mid-year, Pembina is projected to announce its ethane supply plan for the Dow ethane cracker. The assignment of Cedar LNG volumes and an upgrade in project EBITDA are also on the horizon, alongside potential upgrades to marketing and fee-based EBITDA guidance.

The series of strategic moves and project developments outlined by Citi suggest a robust growth trajectory for Pembina. With these factors in mind, the upgrade to a Buy rating reflects a positive outlook for the pipeline company’s financial performance in the near future.

In other recent news, Pembina Pipeline (NYSE:PBA) Corporation has projected its adjusted EBITDA for 2025 to range between $4.2 billion and $4.5 billion. This forecast is driven by anticipated volume growth and new asset contributions but is tempered by challenges like the recontracting of the Cochin Pipeline. Pembina’s capital investment for 2025 is set at $1.1 billion, aimed at ongoing and future projects, with expectations of generating positive free cash flow within the guidance range. In analyst coverage, TD Cowen initiated a Buy rating on Pembina Pipeline, citing the company’s solid growth prospects and setting a price target of Cdn$66.00. Stifel analysts also noted the stock as undervalued, contributing to a positive outlook. Meanwhile, BMO Capital Markets adjusted its price target to Cdn$59.00, maintaining an Outperform rating, despite concerns about softer EBITDA guidance for 2025. RBC Capital Markets included Pembina in its "Best Ideas" for the Canadian Midstream sector, with a price target of CAD 65 and an "Outperform" rating. These developments highlight the company’s ongoing strategies and market positioning.

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