Analyst Benjamin Pham of BMO Capital maintained a Hold rating on South Bow Corp, boosting the price target to C$45.00.
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Benjamin Pham has given his Hold rating due to a combination of factors that balance improving project visibility with lingering structural constraints. He raised his target price to C$45 to incorporate a higher probability of the Prairie Connector proceeding, which could add meaningful long-term value through incremental EBITDA, earnings, and cash flow if it enters service around the end of the decade.
At the same time, he notes that South Bow’s growth outlook lags its peers, its cash flow mix is less diversified, and leverage remains on the higher side, which tempers the upside from the Prairie Connector option value. Given this mix of solid contracted cash flows and an attractive dividend against relatively modest growth and balance sheet risk, he concludes that the shares are appropriately valued at current levels, supporting a Market Perform (Hold) stance.
According to TipRanks, Pham is a 5-star analyst with an average return of 10.3% and a 69.86% success rate. Pham covers the Utilities sector, focusing on stocks such as Fortis, Emera, and Rockpoint Gas Storage, Inc. Class A.
In another report released on April 20, Scotiabank also maintained a Hold rating on the stock with a $34.00 price target.