Parkland’s Strategic Review and Valuation Gap Drive Buy Rating

Parkland (PKI) has received a new Buy rating, initiated by BMO Capital analyst, John Gibson CFA.

John Gibson CFA has given his Buy rating due to a combination of factors that suggest potential upside for Parkland’s stock. Despite reporting softer Q4/24 results, Parkland has initiated a strategic review to explore options for maximizing shareholder value, which includes possibilities such as asset divestments, acquisitions, or even a sale. This strategic review is seen as a positive move, aligning Parkland more closely with SOL and potentially easing the share overhang.
Additionally, Parkland’s valuation appears compressed, trading at approximately 5x 2026E EV/EBITDA, which is at the low end of its historical range and below its peers. The company’s free cash flow yield remains robust at over 10%, supporting the belief in a valuation gap between Parkland and its peer group. These elements, combined with a modest increase in the quarterly dividend, underpin the Outperform rating, suggesting that the stock has room to appreciate as the strategic review progresses.

PKI’s price has also changed slightly for the past six months – from C$36.280 to C$34.880, which is a -3.86% drop .